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Forward-thinking with a worldview shaped by technology, Generation Z are post-millennials, comprised of individuals who are today coming of age. These people have grown up in a world of social media and instant information. Now, they are envisioning a future of home ownership, which means exciting changes for the real estate market. Here we discuss in detail how the next generation of home buyers will demand more from the housing market, reshaping it in the process.
This new generation are more entrepreneurial minded, deviating from the traditional career path and turning to freelancing. In the UK, there has been a 26 per cent increase in the number of 16-29 year olds registering as self-employed over the last eight years. Perhaps seeing older generations struggle and experiencing the financial crisis has forced them to think differently. Also, permanent employment has been gradually decreasing in the UK, made worse by the Brexit vote, so changes in the market may be forcing young people to work independently. It’s no surprise then that Gen Z want to invest in property rather than rent, purely for the financial benefits involved. Research has shown that nearly all of Generation Z highly value home ownership. According to a survey conducted by Better Homes and Garden Real Estate, 97% of Generation Z teens believe they will one day own their own home, but want to reach certain milestones first, such as earning a degree and getting married. Also, four out of five of these Gen Z members see home ownership as an ultimate life goal.
Despite their conservative financial values, Generation Z are non-conformist in a lot of ways. This is reflected most in their online buying activity. This generation have such a strong affinity with the digital world – 90% saying say they would likely purchase a home online. As they live in a time of immediacy, this will deeply impact how they shop for homes. They’ll want their online experience to be efficient and easy to connect with sellers and landlords. Also, with virtual reality set to become an innovative tool for buying and selling property, it’s likely that Generation Z members will naturally require both a digital view, and a physical visit of their desired home. We can expect to see a future where technology will be the driving force in finding a property.
When comparing the housing tastes of Generation Z with previous generations, there are similarities and differences. They prefer the suburban lifestyle, like millennials, yet only 17% of those surveyed wanted to live in the same community as the one they grew up in. They also have travel aspirations, like Generation Y. It could be said that Generation Z are defined by their steady financial values in tandem with their ambitious, free-thinking visions and dreams. They will look for ways to save money, perhaps opting for affordable, functional homes. All in all, their lifestyle will be governed by a larger world focused on a digital society, technological innovation and instant connectivity.
In addition to the housing market, employers must be ready for Generation Z in the workplace. There are a multitude of ways companies can do this. For example, it’s pivotal that companies give their Gen Z employees a voice and let them share their ideas and opinions. This young group of people have a deep understanding of the social landscape and the behaviours of youth, so by encouraging them to always share their insights will keep the company relevant and fresh. Also, companies must ensure there is a feedback system in place, as studies have shown Gen Z members seek guidance and support. These young people are aware that they are beginners in the workforce, so they’ll want opportunities for advancement, and providing feedback can help with their development.
Workplace flexibility is another area that companies need to make sure they create. Gen Z have grown up in a fast-paced, technology driven environment, so employers need to understand that they won’t want to be constrained by traditional work structures. Companies should allow for customised hours and encourage the use of tech platforms and social apps for communication with co-workers, ensuring for greater productivity and a more dynamic workforce. The result will be happier employers and better relationships.
As each new generation enters the real estate market, professionals must adopt new methods and prepare ahead of time. The real estate market will be faced with a whole new paradigm and different challenges, but when successful, there could be great opportunities for real growth in the industry. However, all industries must prepare for this emerging customer base, as the focus shifts from millennials to Generation Z in front of our eyes.
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