- How do you feel about the real estate market right now?
Depends on what you’re buying. After the recent BoC rate hikes, we’re seeing some aspects of the market slowdown. Days on market are increasing and buyers aren’t moving as fast in some areas, particularly single-family homes. Townhomes and condos are still a bit ridiculous as we’re still seeing multiple offers and over ask sales.
- Where do you think the market will be in 5 years?
Tough question to answer. It all depends on how the market reacts to these rate hikes and if the gov’t acts appropriately. Right now there are a few proposed rule changes that could really hurt a lot of people and make buying a lot more difficult, making it better for the rich and hard for first-time home buyers, even those with 20% down.
- Have you noticed any trends with Millennial homebuyers? If so, what are they?
Fun fact, 53% of Millennials own a home and Millennials are increasingly placing a higher value on owning a home than the previous generations, viewing it more as an investment than a debt. First-time home buyers made up 33% of all home transactions in May, a year-over-year increase of 3 percent
- Where are they generally buying and what styles of homes in the Lower Mainland?
In the lower income areas if they can manage to get in. mainly townhomes and condos and those are still very hot right now, still seeing multiple offers and sell over ask
- Have you noticed particular locations or housing contexts (styles) they are drawn to?
Smart homes and eco-friendly homes if they can. With utilities so high and Millennials concern for the environment being much greater than previous generations, they want to do what they can and that includes cutting down on utilities. Smart homes because we’re so tech-savvy and especially cause we’re lazy. You can control a whole home from your iPhone now and if we can afford it, we want it. If they can’t afford that, and most cant, then it's investment properties we want. Millennials more than any other generation are viewing homes as investments and not as debt. All of my friends who are in the 20 range have spoken to me about buying a home because of the income it can produce and are not the satisfaction it provides. Living in such an expensive area and wanting to live such lavish lifestyles makes us think about how we can live such a lifestyle and especially outside of the regular 9-5. Real Estate has made more millionaires than any other generation so it’s no surprise we all want investment properties.
- What are the struggles Millennials face when deciding to purchase a home?
Coming up with the money to do so. In the Fraser Valley, the median price for a single-family detached home is $915,500 Townhome is $540,000 and for a Condo, it's $320,000 (a 30.6% year-over-year increase for condos might I add). You’re going to need about 5% down payment so as you can see, you need good savings to get started or some loving parents who will co-sign.
- What range of budget do Millennial home buyers generally have?
On average, it’s around $350,000 for peak Millennials
- How do they finance for their homes?
They generally use conventional financing. 5% down on a 5-year fixed mortgage that’s insured. Saving for their home involves smart money management which many younger millennials lack, unfortunately. A portion of their income should be going into a savings account, RRSP’s or something that earns a return in order to save for the down payment. Another option, if your parents really love you and you can prove that they can trust you is by having them co-sign so you can get that home that’s just out of reach or if you don’t have the financial history to get approved for a loan.
- Do the amenities that are included in the buildings influence the decision of the Millennial homebuyers? Will they consider a more expensive place for a gym/pool/rooftop/private outdoor space?
Yes, little things like that can go a long way in the buying process as once again, we’re lazy and want everything to be easier so it's appealing for us to be able to do the things we want to do without having to go very far. Privacy is more of a concern for the older generations. Millennials are more social and don’t care too much for the most part about sharing common areas, however, that opinion will differ from person-to-person.
- What are some of the sacrifices they are making?
Putting off big life events such as marriage and having kids is becoming less important to do young versus buying a home. For those who are smart and understand the value of buying a home, they’ll put off a vacation and cut down on the bar tabs with the thought in mind that they need this money for a down payment.
- What kinds of marketing channels or techniques do you find appeal to Millennial homebuyers? (TV ads, print ads, social media, etc.)
The only print I do is feature sheets for my property and “you’re invited” open house cards and either then that, everything is online. Be where the majority of home buyers are and that’s the internet so I invest heavily into Facebook/Instagram ads and I’m currently looking into advertising on Snapchat. Being different is huge for me. If you see my listing videos and how I market them, you’ll clearly see that every aspect of it is different than every other Realtor from the video to the copy for my ads. I hate Salesmen so I do everything I can to not be one. A lot of sh*t Realtors have given good ones a bad rep, so being real and honest is something I’ll strive for when marketing myself and ads.
- What are past solutions that housing developers and mortgage brokers have implemented to attract Millennials?
First-time home buyer grants. So far the government will meet the buyer’s contribution of the down payment up to 5% of the home’s purchase price, to a maximum purchase price of $750,000 and also waived the property transfer tax (1% on the first 200k and 2% on the remainder)
13. What trends are you noticing with types of housing, (where are they being made, condos vs apartments, etc.)
The vacancy rate is below 1% across the lower mainland and also in parts of the Okanogan. We’re seeing Condos being converted into apartments and new apartments that come up having lines of people hopping to get in. Just recently, in Clayton, 200 homes with unauthorized suites received notice that every tenant must vacate the premises or the owner will receive a $500/day fine meaning a lot of families are about to be f*cked. All of it strained from parking problems which are increasingly a problem but there are better ways the situation could’ve been handled. As I talked about above, townhomes and condos are in very high demand, catching up for the 10 years of appreciation they never saw but the single-family homes did. ALR land is continuously being granted for development use and we’re seeing condos and townhomes going up all over the place.
14. Do you think Millennials will be able to afford homes, if not now, in the future?
Vacancy rate is below 1% across the lower mainland and also in parts of the Okanogan. We’re seeing Condos being converted into apartments and new apartments that come up having lines of people hopping to get in. Just recently, in Clayton, 200 homes with unauthorized suites received notice that every tenant must vacate the premises or the owner will receive a $500/day fine meaning a lot of families are about to be f*cked. All of it strained from parking problems which is increasingly a problem but there is better ways the situation could’ve been handled. As I talked about above, townhomes and condos are in very high demand, catching up for the 10 years of appreciation they never saw but the single-family homes did. ALR land is continuously being granted for development use and we’re seeing condos and townhomes going up all over the place.
15. If Millennials were to buy a house in the future, what advice would you give them?
Have a good savings account and think about your future. If you see more people being added to the family, don’t buy a condo, upgrade to a townhome. You qualify for the property transfer tax now but the second time around you won’t and if you do the math, it is not cheap at all. So save your future self the 10’s of thousands of dollars and plan for your future accordingly.
16. What challenges do you face selling homes to Millennials?
It depends on the person. I’m a millennial, I specialize working with them and from talking to the more seasoned Realtors, they don’t like working with us. We’re very different from previous generations so it can be difficult for older Realtors to understand us and why we can be so difficult. Specific tactics and phrases, not really but for me, I ESPECIALLY hate salesmen and millennials as a whole do as well and can sniff them out from a mile away. Those old “act now” “it won’t last” ads, don’t work with us and we don’t care to bother with them. My approach is being real and honest. No matter what most people think, as a Realtor, I’m not a salesman. I’m in the service industry. I’ll make you aware of what I offer and how I do it then leave it up for you to decide to work with me. I hate the Realtors who sell themselves way to hard and sell people into buying this home just so they can get their commission check. It’s unethical and not how to run a business. My strategy you could say for working with Millennials is being paperless and utilizing technology to the fullest. I’m an Apple guy, so IPads and MacBook’s are going to be a sure thing when you work with me. That’s a Millennial thing for the most part. My current clients who are in there 50’s had no idea how they’re supposed to sign a contract on my IPad.