Baby Boom, Baby Boom, Baby Boom
There are so many of them about 76 million, born between 1946-64 and their spending habits so influential that for years they've driven the decision-making process at all levels of the housing world.
The successor demographic, dubbed Generation X, has started to be heard. But a California real estate consulting firm is looking further down the road, and charting the housing preferences of Generation Y, sometimes called the Echo Boomers or Millennials.
They're going to be influential though maybe for what they're not going to do rather than what they will do, according to Tim Cornwell, a researcher for the Concord Group, a housing consultancy in San Francisco that in the past year has been studying their housing attitudes.
"Our generation has been raised in a world where they're told every single day they can have everything they want," he said of Generation Y, of which he is a member, having been born in 1980. The reality of today's economy may make that mindset a little tricky for them, he said.
Five things to know about Gen Y and housing:
1. Demographers differ on when members of Generation Y started to be born, though one often-cited bracket for the age group is 1977 through 1989, years that slightly overlap with Generation X, which analysts generally say were born 1965 through 1980. Generally speaking, the 60 million or so Americans in the Y group are now in their 20s, and Cornwell said they haven't been studied much yet.
2. Where baby boomers and Gen X started to make themselves known in the real estate market in their 20s, Generation Y will be taking its time, for a couple of reasons. For one thing, they're postponers. They graduate from college and use graduate school to postpone adulthood or they travel for an extended period after school. These decisions limit their earnings and any savings that might otherwise go into homebuying.
3. Gen Y has a "mobile mindset," where lifestyle is everything.
"Used to be, you picked a job and you moved to the city where that job was," Cornwell said. But this group values locale and amenities first, and may be inclined to move to try out different places and will look to wedge in their jobs and careers accordingly.
4. Their affinity for neighborhood amenities means that their real estate purchases, when they happen, probably will be in so-called "inner ring" suburbs, near-in to larger cities, Cornwell said, though there's a difference of opinion within the research that's been done so far.
5. What do they want in a house? There's a stated preference for open floor plans, Cornwell said. In Concord Group research, the younger Gen Y respondents (20-24) were less interested in a larger home size the next time they moved. They want a big kitchen (though they're inclined to eat out), and a garage and some yard space. They have little interest in a formal dining room or a media or game room.
About one-fourth of all the Gen Y people surveyed said they'd pay 5% to 10% extra to live a 10-minute walk or bike ride (or short car trip) to get to work or retail services.