Gen Y Buying Homes Earlier Than Boomers Did

Brought to you by

Gen Y Buying Homes Earlier Than Boomers Did

MBA (4/21/2006) McAfee, Jamie The reasons why Baby Boomers and Generations X and Y bought their first homes reflect different influences, according to The "Century 21 Homebuyer Survey," by Century 21 Real Estate LLC, Parsippany, N.J. Baby Boomers (born between 1946-1964) purchased their first home based on family reasons while Generation X (born between 1965-1978) and Generation Y (born between 1979-1994) are buying or have bought a home as a safe investment, the survey found. The survey asked the three generational groups questions to discern some of the factors that influence the first-time home buying experience. Generation X and Y buyers tend to take longer to buy their first home, compared to Baby Boomers. Generation Y buyers are also purchasing first homes at a younger age than their Generation X and Baby boomer counterparts are. The average age for first-time homebuyers was 26 among Generation Y respondents, which is three years younger than Generation X (29) and Baby Boomer (29) survey participants, the survey said. Of the survey respondents, the average boomer polled was 51 years old, followed by Generation X and Y at 34 and 25 years old, respectively. Seventy-two percent of Generation Y respondents were single women, followed by 56 percent of Generation X'ers and 59 percent of Baby Boomers, according to the findings. Finally, 25 percent of Gen X respondents are single/never married compared to only 5 percent of Baby Boomers. Buying trends among the generations revealed the Generation X and Generation Y buyers tend to spend more for their first home than Baby Boomers which represents a larger portion of their household income. On average, the impact on the household income was 21 percent of Boomers' income as compared to 25 percent of Generation X and Generation Y's household income. When purchasing a home, Baby Boomers said price was a key concern (51 percent) compared to Generation X (42 percent) and Generation Y (39 percent). Generation X (8 percent) and Y (10 percent) buyers were more concerned with proximity to work for their first home than Boomers (4 percent). To find a home, the majority of Baby Boomers (53 percent) ranked real estate brokers/agents as the primary source of information on their first home, followed by 45 percent of Generation X and 34 percent of Generation Y buyers. Generation Y homebuyers (42 percent) search the Internet far more than their Generation X counterparts (26 percent). Forty (40) percent of all survey respondents said that the best way to find a broker/agent was through friends and relatives. In all three groups of buyers, the majority preferred more frequent contact from their broker/agent when buying a first home (more than 50 percent want contact every few days). The Internet replaced the Boomers (17 percent) drive-by signage for finding a broker/agent. Twenty-one percent of Generation X and Y buyers used the Internet. While Generation Y respondents ranked the Internet as their primary source of home shopping information, it took them longer on average to purchase their first home. When buying their first home, Baby Boomers were the quickest averaging 4.3 months, followed by Generation X at 4.6 months and Generation Y at 5.4 months. After homes were purchased, Baby Boomers (26 percent) were more likely to stay in their first home for more than 10 years as compared to Generation X (13 percent) and Generation Y (9 percent). International Communications Research (ICR) of Philadelphia conducted the survey between March 17 and March 31, with 1,514 respondents completing an online survey via the ICR Web site because of an e-mail invitation. Century 21 Real Estate LLC commissioned the study.