{"id":5825,"date":"2024-04-12T20:05:00","date_gmt":"2024-04-13T00:05:00","guid":{"rendered":"https:\/\/propertyonion.com\/education\/?p=5825"},"modified":"2024-04-14T10:10:15","modified_gmt":"2024-04-14T14:10:15","slug":"gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know","status":"publish","type":"post","link":"https:\/\/propertyonion.com\/education\/gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know\/","title":{"rendered":"Gen Z Is in the Real Estate Marketplace and Here\u2019s What You Need to Know"},"content":{"rendered":"\n<p>Gen Z means anyone born between 1997 and 2012. They are the generation directly following Millennials (1980-1996). Gen Z is often known for growing up alongside rapidly changing technology.<\/p>\n\n\n\n<p>Gen Z is quickly coming of age and entering the real estate marketplace, many of them with a leg up on the competition. Between social media influencers, technology advancement, and an increase in multi-generational households,&nbsp;<a href=\"https:\/\/www.housingwire.com\/articles\/what-makes-gen-z-homebuyers-different\/?cx_testId=3&amp;cx_testVariant=cx_1&amp;cx_artPos=4&amp;cx_experienceId=EXZNOASUT0V6&amp;utm_campaign=Newsletter%20-%20HousingWire%20Daily&amp;utm_medium=email&amp;_hsmi=288150753&amp;_hsenc=p2ANqtz-9dxO6rmi86xGd9bUNgxJY7Y-o9onP5IH07m3EJSCzFdCTfssC71XU_z_XkHUDA6Hhku23-J62GUNmvRklpIbkrmSzfSVXrpcmGKwgAvjB7Q37snjI&amp;utm_content=288150753&amp;utm_source=hs_email#cxrecs_s\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">unique investment opportunities are brewing<\/a>.<\/p>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 ez-toc-wrap-left counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">In this Article:<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/propertyonion.com\/education\/gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know\/#Buying_Younger\" >Buying Younger<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/propertyonion.com\/education\/gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know\/#Affordable_Cities\" >Affordable Cities<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/propertyonion.com\/education\/gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know\/#Differences_Between_Gen_Z_Buyers_and_Millennials\" >Differences Between Gen Z Buyers and Millennials<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/propertyonion.com\/education\/gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know\/#Gen_Z_Homeownership_Interest\" >Gen Z Homeownership Interest<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/propertyonion.com\/education\/gen-z-is-in-the-real-estate-marketplace-and-heres-what-you-need-to-know\/#What_Gen_Z_Is_Changing_about_Investing\" >What Gen Z Is Changing about Investing&nbsp;<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Buying_Younger\"><\/span>Buying Younger<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>As of recently collected&nbsp;<a href=\"https:\/\/www.redfin.com\/news\/gen-z-millennial-homeownership-rate-home-purchases\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">housing data courtesy of Redfin<\/a>, 30% of 25-year-olds in the Gen Z cohort owned their own home in 2022. That\u2019s up by 2% from Millennials at the same age and 3% from Gen X (1965-1980). Though the statistic comes in 2% lower than home-owning&nbsp;<a href=\"https:\/\/propertyonion.com\/education\/how-baby-boomers-will-transform-the-2024-housing-market-and-beyond\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">Baby Boomers<\/a>&nbsp;(1946-1964) at the same 25-year-old benchmark.<\/p>\n\n\n\n<p>Why is homeownership on the rise? Why are so many Gen Zers focused on homeownership? Well, the pandemic is responsible in part.<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>Those Gen Zers who didn\u2019t get in on the ground floor of pandemic buying are having a much harder time finding an affordable home.<\/p><\/blockquote>\n\n\n\n<h3 class=\"wp-block-heading\">Pandemic Buying Boom<\/h3>\n\n\n\n<p>The oldest members of the Gen Z cohort graduated college around the start of the pandemic. And they recognized an opportunity when they saw one.&nbsp;<\/p>\n\n\n\n<p>With the rise of remote work, many were able to start working right out of college, from the luxury of their childhood bedrooms.&nbsp;<\/p>\n\n\n\n<p>The pandemic drove many people regardless of age group to live with family members. For recent college grads and students, living with their parents was the logical solution. Now, you have an entire generation of these young adults, sitting on savings they\u2019ve amassed over the past few years, looking to put that money into real estate.<\/p>\n\n\n\n<p>With record low mortgage rates between 3.1% at the rock bottom of the buying boom in 2020, some of these savvy investors bought homes, rented them out, and continued to live rent-free with family. However, there are still many members of Gen Z who were not so lucky.&nbsp;<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>Millennials are purchasing more expensive homes than their younger counterparts while others have given up the prospect of purchasing entirely.<\/p><\/blockquote>\n\n\n\n<h3 class=\"wp-block-heading\">Haves and Have Nots<\/h3>\n\n\n\n<p>Some industry experts when asked about Millennials or Gen Zers bring up the \u201chaves\u201d and \u201chave nots,\u201d meaning those who&nbsp;<em>have<\/em>&nbsp;a home and those who don\u2019t. Those Gen Zers who didn\u2019t get in on the ground floor of pandemic buying are having a much harder time finding an affordable home.<\/p>\n\n\n\n<p>As of August 2023, according to recent data collected by the National Association of Realtors, the median national price for a home is slightly more than $405,000.&nbsp;<\/p>\n\n\n\n<p>Three years before, the median national home price was around $310,000. That\u2019s a 3-year leap of nearly $100,000. Imagine that kind of equity!<\/p>\n\n\n\n<p>Those in the Gen Z cohort who have yet to purchase a home are facing higher student debt than previous generations, home supply shortages, and home prices that have risen faster than wages.&nbsp;<\/p>\n\n\n\n<p>According to&nbsp;<a href=\"https:\/\/www.census.gov\/programs-surveys\/acs\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">US Census data<\/a>, the average earnings of individuals with bachelor\u2019s degrees only increased by $13,651 between 2010 and 2021\u2013about 28.8%. Compared with the $93,000 increase in home prices \u2014 about 49.3% \u2014 some would-be prospective buyers are discouraged.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Affordable_Cities\"><\/span>Affordable Cities<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>For those who are buying younger and working remotely, many are looking in cities with lower home prices. Even those who live in expensive locales, like California, can find a reasonably priced home in the Midwest, rent it out, and&nbsp;<a href=\"https:\/\/propertyonion.com\/education\/how-to-brrrr-like-a-boss\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">keep building up their portfolio<\/a>. Not a bad strategy.<\/p>\n\n\n\n<p>Keep in mind&nbsp;<a href=\"https:\/\/www.bloomberg.com\/news\/articles\/2023-03-13\/gen-z-americans-keep-spending-in-face-of-high-inflation-consumer-prices?sref=fRZXrT1O#xj4y7vzkg\" target=\"_blank\" rel=\"noopener\">wages rose in 2022 by 12%<\/a>&nbsp;and more than&nbsp;<a href=\"https:\/\/www.businessinsider.com\/gen-z-higher-homeownership-rates-than-millennials-at-age-25-2023-4\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">24 million jobs<\/a>&nbsp;have been added to the market since April 2020. According to the U.S. Census data, total employment now exceeds pre-pandemic levels.<\/p>\n\n\n\n<p>Those freshly minted grads with remote work savings are hoping to make that money go further in places like Cincinnati, OH, and Virginia Beach, VA. Here\u2019s a list of where these buyers are buying in descending order of the percentage of homes purchased by those under 25 years old.<\/p>\n\n\n\n<ul class=\"wp-block-list\"><li>Virginia Beach, VA \u2014 8.9%<\/li><li>Cincinnati, OH \u2014 8.5%<\/li><li>Detroit, MI \u2014 7.9%<\/li><li>St. Louis, MO \u2014 7.5%<\/li><li>Indianapolis, IN \u2014 7.1%<\/li><li>Pittsburgh, PA \u2014 7.0%<\/li><li>Kansas City, MO \u2014 6.7%<\/li><li>Cleveland, OH \u2014 6.6%<\/li><li>Minneapolis, MN \u2014 6.5%<\/li><\/ul>\n\n\n\n<p>The median sale prices of these homes ranged from the highest in Minneapolis, MN, at $275,000 to the lowest at $165,000. The lowest price is a three-way tie between Detroit, MI, Pittsburgh, PA, and Cleveland, OH. (These numbers account only for the price paid by those under 25 years old, not the median purchase price for the entire market.)<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>There are a lot of factors at play here, including obstacles like salary, savings, rising purchase prices, and mortgage hikes.&nbsp;<\/p><\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Differences_Between_Gen_Z_Buyers_and_Millennials\"><\/span>Differences Between Gen Z Buyers and Millennials<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>According to the numbers, there are a few key differences between these two generations. While industry experts may speculate about the luck of Millennials coming of age in the economic crisis and growing up in the recession, the why doesn\u2019t make a difference to the haves and have-nots. But the&nbsp;<em>how<\/em>&nbsp;might.<\/p>\n\n\n\n<p>According to surveys, data, and census information, <a href=\"https:\/\/propertyonion.com\/education\/brace-yourselves-wealthy-millennials-are-migrating-to-these-two-states\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\"Millennials (opens in a new tab)\">Millennials<\/a> tend to buy homes in tech hubs, which can be more than triple the price of the homes Gen Zers are flocking to.<\/p>\n\n\n\n<p>For example, the number one destination for Millennial homebuyers was Seattle, WA, as of 2022. 41.4% of the home sales in that area were to individuals from the Millennial cohort. The median home price? $775,000. Compared with the hottest purchasing spot for Gen Z in Virginia Beach, VA, at $255,000, that\u2019s a whole world of difference!&nbsp;<\/p>\n\n\n\n<p>The Millennial cohort\u2019s top 10 metro median purchase prices range from $1,365,000 in San Jose, CA, to Detroit, MI, at $205,000. While some of the top destinations overlap between cohorts, the sale prices do not. Millennials are purchasing more expensive homes than their younger counterparts while others have given up the prospect of purchasing entirely.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Gen_Z_Homeownership_Interest\"><\/span>Gen Z Homeownership Interest<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>While more Millennials have given up on owning a home than other age groups, Gen Zers come in on the high end of belief with&nbsp;<a href=\"https:\/\/www.rocketmortgage.com\/learn\/gen-z-home-buying\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">71.5% of them planning to purchase their first homes in one to six years<\/a>. 87% of Gen Z survey respondents admitted to planning on owning a home. Meanwhile, only 63% of Millennials could say the same.<\/p>\n\n\n\n<p>There are a lot of factors at play here, including obstacles like salary, savings, rising purchase prices, and mortgage hikes.&nbsp;<\/p>\n\n\n\n<blockquote class=\"wp-block-quote is-layout-flow wp-block-quote-is-layout-flow\"><p>Keep in mind that many of the Gen Z population cite social media as a direct resource for decision-making.<\/p><\/blockquote>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"What_Gen_Z_Is_Changing_about_Investing\"><\/span>What Gen Z Is Changing about Investing&nbsp;<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Clearly, this cohort is taking the real estate world by storm and bringing with them a whole load of new investing strategies.<\/p>\n\n\n\n<p>For instance, remote landlords.&nbsp;<\/p>\n\n\n\n<p>In the past, landlords needed to be easily reached and often they would live near their rentals to manage them. With remote landlord\/leasing software, that\u2019s a thing of the past. Previously only used by large corporations, this technology has erased the need to limit your investments by location.&nbsp;<\/p>\n\n\n\n<p>Also, take note of social media.<\/p>\n\n\n\n<p>You may have opinions about it already, but keep in mind that many of the Gen Z population cite social media as a direct resource for decision-making. To put it simply, instead of Googling questions, they turn to their favorite influencer or hashtag for answers.<\/p>\n\n\n\n<p>Influencers live up to their name, influencing those who follow them to purchase in certain places, to support specific brands, and to boycott others.<\/p>\n\n\n\n<p>While you may be wary of what a social media presence might entail, if you have plans to grow your business and reach the Gen Z market, a social media presence is a must.<\/p>\n\n\n\n<p>Keep that in mind and take a look at your&nbsp;<a href=\"https:\/\/propertyonion.com\/education\/how-to-invest-based-on-2024-mortgage-rate-predictions\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">investment strategy for 2024<\/a>&nbsp;while you still&nbsp;<a href=\"https:\/\/propertyonion.com\/education\/10-ways-of-making-your-investments-work-for-you-in-2024\/\" target=\"_blank\" rel=\"noreferrer noopener\" aria-label=\" (opens in a new tab)\">have time to plan<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>Gen Z means anyone born between 1997 and 2012. They are the generation directly following Millennials (1980-1996). Gen Z is often known for growing up alongside rapidly changing technology. Gen Z is quickly coming of&hellip;<\/p>\n","protected":false},"author":34,"featured_media":5889,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5],"tags":[841,571,217,840,842,534,213,229,194],"class_list":["post-5825","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-real-estate-investing-articles","tag-affordable-cities","tag-affordable-housing","tag-covid-19","tag-gen-z","tag-investment-opportunities","tag-investment-strategy","tag-millennials","tag-pandemic","tag-planning"],"_links":{"self":[{"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/posts\/5825","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/users\/34"}],"replies":[{"embeddable":true,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/comments?post=5825"}],"version-history":[{"count":2,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/posts\/5825\/revisions"}],"predecessor-version":[{"id":5832,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/posts\/5825\/revisions\/5832"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/media\/5889"}],"wp:attachment":[{"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/media?parent=5825"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/categories?post=5825"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/propertyonion.com\/education\/wp-json\/wp\/v2\/tags?post=5825"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}