Survey Says: This Is What Today’s First-Time Home Buyers Are Looking For

Survey Says: This Is What Today’s First-Time Home Buyers Are Looking For

3 min read
Jamie Greenberger Read More

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Buying your first home is an exciting, albeit stressful experience. From picking the perfect location, settling on a size, and designing to fulfill your dreams, there’s a lot that goes into finding a first—and sometimes forever—home.

But just as the headlines suggest, this process looks very different depending on the age of the buyers. While most of the talk about millennials and real estate points fingers at the generation for “killing” the housing market (1), they’re actually just shaking it up (2). Not only are they skipping starter homes and buying their dream home once they’re financially ready, but the homes they’re after also look remarkably different from those of their predecessors (3).

Generational shifts certainly alter what the picture-perfect starter and dream home look like, but gender also plays a role in what first-time home buyers look for. A recent study by insurance expert Clovered set out to find what features and amenities mattered most to first-time home buyers and how these qualities differed across generations and genders.

Size Matters

Despite numerous headlines suggesting millennials are after modest, small homes (4), Clovered’s study found that millennials’ dream homes were larger than baby boomers and Gen X-ers—in both square footage and the number of bedrooms and bathrooms. While baby boomers dreamt of a house under 3,000 square feet, Gen X-ers thought 3,311 square feet was ideal, while millennials upped the size to 3,320 square feet. Along the same lines, dream homes of the oldest generation contained an average of 3.7 bedrooms and 3.1 bathrooms, while the ideal number of beds and baths for millennials was 4.2 and 3.3, respectively.

Related: 4 Popular Mortgage Programs for First-Time Home Buyers

However, when crafting the perfect starter home rather than a dream home, all generations leaned toward the smaller size. This time, the ideal size was just 1,442 square feet for baby boomers, 1,582 square feet for Gen X-ers, and 1,726 square feet for millennials. Homeowners even required fewer bedrooms and bathrooms, with Gen X-ers and millennials agreeing that 2.8 bedrooms were ideal.

Perfect Area and Amenities

Finding a home with the perfect square footage and number of bedrooms and bathrooms may be a step in the right direction, but it means nothing when the location isn’t right. Picking a “good” location means something different to everyone, but according to the study, the majority of men and women said affordability of the area was the most important thing (5).

Low crime rates and proximity to workplace were also among the top factors, with women more likely to consider both. Men, on the other hand, were more likely to take climate and geography of the area into consideration.

The most important amenities also differed between the genders—while central air conditioning, a private backyard, storage, and plenty of natural light topped the list, women were more likely than men to name them as important. In fact, the only amenities men wanted more than women were granite countertops, exterior balconies, smart home technology, and an elaborate front door.

However, when it comes to naming the most important amenities for a dream home, a walk-in closet in the master bedroom and a separate laundry room entered the top five and men’s interest in an oversized garage spiked (from just 15 percent in a starter home to 56 percent in a dream home).

Related: The American Dream: How Has the Definition Changed Over the Years?

Dreams Do Come True… Eventually

Millennials may wish for a larger home than previous generations, and women may be after a long list of amenities, but these ideal starter homes aren’t all that out of reach. In 2017, the average single family home was 2,660 square feet (6)—significantly larger than all generations’ ideal size of their starter home. But rising house prices matched with lagging inflation and wage growth means both dream homes and starter homes are increasingly out of reach (7).

Until home prices begin to normalize, prospective homeowners are forced to put away their wish lists and settle for a more affordable home.

Sources

  1. https://www.forbes.com/sites/neilhowe/2018/08/27/are-millennials-killing-the-u-s-housing-market/#762ef5ea1ead
  2. https://www.forbes.com/sites/megangorman/2019/08/31/how-millennials-are-revolutionizing-the-home-buying-process/#76ad7ff92a02
  3. https://www.usatoday.com/story/money/2018/05/07/millennials-buying-first-home-skip-starter-house-buy-dream/582309002/
  4. https://www.businessinsider.com/millennials-vs-baby-boomers-big-houses-real-estate-market-problems-2019-3
  5. https://www.investopedia.com/financial-edge/0410/the-5-factors-of-a-good-location.aspx
  6. https://www.statista.com/statistics/529371/floor-area-size-new-single-family-homes-usa/
  7. https://www.cnbc.com/2018/06/06/us-house-prices-are-going-to-rise-at-twice-the-speed-of-inflation-and-pay-reuters-poll.html

What trends have you noticed younger buyers or renters are seeking out? Are you doing anything to accommodate their needs and wants? 

Let’s talk in the comment section.