Introducing the Gen Z Homeowner

  • Categories:

    Industry Trends, Marketing Insights

  • Date:

    April 5, 2022

Introducing the Gen Z Homeowner

Industry Trends Marketing Insights

For years, millennials have been the darlings of the housing market. Born between 1981 and 1996, these adults not only make up the largest current generation in the United States but also accounted for 37% of all homebuyers in 2020. As a result, marketers in the home and building industry have become well aware of millennial housing trends and desires as well as the influence they exert on the market.

While millennials maintain a significant amount of purchasing power in the category, a new generation is slowly creeping into the first-time homeownership age range: Generation Z.

Generation Z (born 1997ā€“2012) represents the next disruptive cohort that will create challenges and opportunities for marketing teams. For starters, most Gen Zers have never known a time without social media or smartphones. And as their attention spans are short, they tend to evaluate brands quickly. So although Gen Zers represented only 2% of total homebuyers in 2020, that number is anticipated to increase as the oldest members turn 25 this year.

What makes these up-and-coming homeowners unique, and how can marketers build a connection?

Here are 10 differences between homebuyer preferences among millennials and Generation Z.

  1. Make It My Own: Both millennials and Gen Z dream of customizing their homes, but their motivations are different: Millennials want their homes to reflect the beauty of their personal taste, while Gen Zers want their homes to showcase their unique individuality.

  2. Make It on My Own: While both generations view buying a home as proof of their financial independence, millennials perceive homeownership as a financial milestone in their lives, but Gen Zers view homeownership as freedom from parental support.

  3. Buying Responsibly: Both generations are more inclined to purchase from brands that are socially and environmentally responsible. Specifically, Gen Zers choose brands that share their views on social issues and purchase products that will more overtly display their social and political beliefs (Consumer Culture Report). Savvy as they are, both generations demand authenticity and commitment from brands and are quick to identify those that are engaging with a cause insincerely.

  4. Shifting Focus Onto Self: Unsurprisingly to those of us who remember our teens and 20s, Generation Z considers their relationship with themselves to be the most important. That being said, it is valuable to them to spend money on experiences such as hobbies and entertainment. Their millennial counterparts, on the other hand, are more concerned with growing families and saving for the future.

  5. The Brand Effect: In general, millennials are more brand agnostic than their Generation X predecessors, who bought brands to follow trends and fit in. Even further down the line, Gen Zers buy brands that celebrate their individuality, because they want to stand out.

  6. Brand Influencers: Millennials often take their children into account when it comes to selecting brands. Members of Gen Z, not surprisingly, rely on social media (category influencers and friends) for brand inspiration and validation. In fact, 70% of Gen Zers find new products through social media (Consumer Culture Report).

  7. Bricks and Clicks: Millennials reported a slightly higher preference for shopping in brick-and-mortar stores throughout the last few years than did Generation Z, who enjoy shopping in physical stores but will also shop on almost any device and in any format/channel. And due to the pandemic, Gen Zā€™s preference for finding new products in-store decreased even more, from 58% in 2020 to 38% in 2021 (Consumer Culture Report).

  8. Place and Space: Millennials are inclined to prioritize livable space over storage space in their homes, more than Gen X did before them. Millennials are also more transient in their home ownership, with many being willing to sell and move within a short span of time. Members of Gen Z ā€” the most diverse generation in modern history ā€” are willing to purchase homes in more diverse and lower-income neighborhoods. Both generations, however, want homes that have multiuse spaces that they can easily convert from one function to the next.

  9. Penny Pinching: Members of both millennials and Gen Z are bargain hunters. Millennials are willing to buy fixer-upper homes and undertake small DIY projects to achieve their goals. Meanwhile, 78% of Gen Z will wait for sales or price decreases on desired items before buying (Consumer Culture Report).

  10. The Stress of It All: The stressors of the pandemic, gun violence, racial inequity, the housing market, job pressures, political discord and more have created a great deal of anxiety for both generations, with slightly more Gen Zers reporting being stressed (48%) than millennials (44%). This stress has shifted attitudes and beliefs from more idealistic (millennials) to more cautious and pessimistic (Gen Z), which can influence their shopping and purchasing behavior.

So, what does this all mean if you are looking to make a connection with the youngest homebuyers?

Whenever possible, your brand should continue to offer personalized experiences and education that arm Gen Zers with the tools they need to make informed decisions about homeownership. Keeping an eye on the challenges prospective Gen Z homeowners face, sourcing inventory that meets their specific needs and desires, and supporting social causes in an authentic manner are the keys to winning their trust and their business for years to come.

Want to chat more about the potential of the Gen Z homeowner? Email me.

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