The millennial generation is poised to make a significant impact on home design with their strong preferences for energy efficiency and smart home technology; comfortable, workable kitchens and more casual spaces, say speakers recently from the National Association of Home Builders (NAHB) and Better Homes and Gardens. Both spoke at a press conference on housing preferences for millennials, Gen X, boomers and seniors held recently during the NAHB International Builders’ Show in Las Vegas.
But first, they have to move out of their parents’ homes and into a place of their own, says NAHB Assistant Vice President for Survey Research Rose Quint. In 2015, about 15 percent of adults ages 25-34 lived with a parent, about 3 percent more than the highest share between 1983 and 2007 – 12 percent. That translates into 1.3 million people who normally "would be out there, forming their own households, demanding their own units," either as buyers or renters, she says.
Quint had anticipated that new mortgage programs and looser mortgage insurance requirements unveiled a year ago would have led to an increase in consumers buying homes for the first time. But a look at the size of the typical new single-family home in 2015 found the opposite: home sizes grew to an average of 2,721 square feet, the highest yet, and an indication that the new-home market continues to be dominated by move-up buyers, rather than first-time buyers.
"Before we see that expected pullback in square footage and price, we’re going to have to see a significant return of the first-time buyer," who is more likely to buy a smaller home at a lower price point, Quint says.
This year, home buyers of all ages say they are looking for homes with separate laundry rooms, energy-star appliances and windows, exterior lighting and a patio.
What they don’t want are rooms with cork flooring, elevators, pet washing stations, expensive outdoor kitchens and fireplaces, and two-story entryways and family rooms. And their countertops should be granite, but never laminate, according to a Fall 2015 survey of potential buyers.
In terms of house type, buyers want a detached, single-family home: 65 percent of all buyers and 68 percent of millennials expressed that preference. That number rises to 72 percent with Gen X (born between 1965 and 1979) but falls somewhat to 55 percent with those born before 1945, Quint says.
The survey results are also important to home builders in the 55+ market, says David Peskin, president of Reverse Mortgage Funding LLC (RMF), which sponsored the NAHB study on consumer preferences. “The boomer generation is currently experiencing a transition to their next phase of life, so the home building and finance industries should commit to better understand the wants and needs of this generation to offer the best possible solutions for them," Peskin says.
"The results of this important survey shed light on the buying preferences of older Americans, and confirm that an uneasiness over finances is one of the primary reasons they are hesitant about relocating to a new residence that better suits their needs. At RMF, we are committed to helping home owners age 62 and older meet their financial needs, so this data will be informative to the way we educate consumers about our Home Equity Conversion Mortgage for Purchase (H4P) product."
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