The millennials (known also as the children of baby boomers born between 1972-1992) and the post Second World War baby boomers (born 1946-1965) are making the greatest impact on the real estate industry today.
“Both the boomers and the millennials want move-in ready homes,” says Century 21 Real Estate Canada president Don Lawby. His company, in conjunction with Rona, recently conducted a national home buyers preference survey that looked at the generations’ purchasing preferences and regional differences.
“Time is very important to people…they want to spend time doing what they want to do and not the things have to do,” says Lawby. The survey also showed that 37 per cent of millennials planned to move within two years.
“The message that it sends sellers is that if you are thinking of selling or putting your home on the market and something needs to be done, do it before you put it on the market,” Lawby says, adding it may be something as basic as painting a room. Digital images of the home showing its curb appeal are becoming more important, says Lawby. Sellers should be aware of how the home looks when presented digitally.
Lawby says the company made the decision to conduct the survey to see “if it really was about location, location, location.” While the old maxim still applies, it is impacted by lifestyle choices to a greater degree than in the past, he says.
There is a general shift away from long commutes and greater focus on family time and career choices by the millennials. The survey showed a short commute was important to 46 per cent of millennials and only 25 per cent of baby boomers, the demographic group that caused bedroom communities to expand around larger cities a generation ago.
Baby boomers are looking to enjoy leisure time such as pursuing travel or hobbies in their move-in ready homes as they downsize. The survey found that 28 per cent of boomers wanted funds left over when buying a house, compared to 18 per cent of millennials.
Many greying boomers (8.2 million according to Statistics Canada) no longer want to maintain a single-family house or empty nest.
“Baby-boomers don’t need to work,” says Lawby. “They are going into condos because they have the ability to close the door and walk away. They are cashing out to some degree in big cities and moving to the smaller communities.”
That cash-out of traditional single-family homes is needed in cities to supply the base for entry-level condominium homes. “If you don’t have an entry point in the market, there is no first-time buyer. You are seeing in cities that they are wiping out whole blocks of single-family detached housing to build townhouses or row-houses as developers are optimizing the value of the land,” says Lawby.
The millennial generation has a realm of other concerns. Many of the children of boomers (StatsCan figures estimate 9.1 million of them) either can’t afford single-family housing or don’t want to spend time cutting the lawn and renovating as their parents did.
They are looking for ways to maximize personal time and limit time spent on traveling to work, services or recreational facilities, Lawby says. There’s also a concern that interest rates, which have remained low for a prolonged period, will rise, infringing upon their ability to renovate a home.
The millennial generation is becoming clustered around work, often in cities, and fuelling the high-rise trend experienced as densification occurs.
The big drivers in how individuals in more rural or remote areas are situating themselves are driven by climate change and geography, says Lawby. Individuals in these communities also want to be near social activities or centres. “They want access to curling or skating indoors (in areas where winters are longer).”
The survey highlighted some regional differences in buyer preferences. In Atlantic Canada “they are looking for a good home in a good area many of the communities are smaller, so they are looking for good access to services and amenities,” Lawby says.
In Ontario, homes with character features are the hot ticket. “There is some prestige in finding a character home in a nice area with trees and it feels like the kind of place that you would like to raise a family,” says Lawby.
Quebec buyers place a high value on their social life and want to be involved in activities. “They want money left over after buying a home…and they want to be close to where they are working. They like the city, but don’t live in high-rises but in older properties.”
In the Prairies, says Lawby, there is a focus on wanting to be close to centres that can provide social or recreational activities. That is indicative of the harsh and long winters and home buyers want to be able to escape into a social atmosphere, rather than be isolated.
Alberta buyers, though, want to be situated in an area that generates a sense of community and that is family oriented. They are more interested in single-family homes than condos. They are entertainers and want a property that allows them to entertain inside and outside.
In B.C., Lawby says it’s about lifestyle. Buyers want to be close to recreational facilities, services and entertainment.