Buyer Trends: Generation Z

I'm lucky to work with clients of all ages. From listing a home for a downsize of a baby boomer, all the way to helping a first time buyer from Generation Z, I work with all kinds of people.

Different generations have different challenges to overcome in this unique market. Generation Z, which is compromised of anyone born between 1996 and 2010, are starting to buy homes. With that in mind, here are the hurdles they face. These are challenges that I assist Gen Z and other generations overcome.

Major obstacles

• Down payment: Forty percent of non-homeowners reported an inability to save for a down payment and closing costs. Gen Z borrower would need to sock away more than $12,000 — and more, on top of that, for closing costs, moving expenses and home repairs. My solution is to connect my buyers with an experienced local lender who can give them more options. Many buyers I meet with think they need 20% down to buy a house, but my lenders have options at 0% down, 3% down, and grants available to Gen Z and other buyers as well.
• Inflation: As Gen Z earns entry-level salaries, they’re grappling with heftier costs thanks to inflation, which has touched everything from groceries to gas and rent. Inflation remained elevated as of August 2023, and some analysts expect it to stay that way into 2024. Not much I can do about this other than run accurate comps to ensure my buyers are making a wise financial investment.
• Student loan debt: Countless studies have shown both millennials and Gen Z have delayed life moves such as buying a home due to student loan debt. College debt not only prevents renters from saving meaningfully for a down payment; it also factors into a mortgage borrower’s debt-to-income (DTI) ratio, which directly impacts how much can be borrowed and at what rate. One important fact I help buyers consider when buying is the options of loan deferment and forgiveness which will increase the likelihood of loan approval. My lending partners are experts in this field and have assisted clients get approved sometimes even if the first lender they spoke with couldn't.
• Winning in multiple offers. This is a problem for all buyers today given the limited number of listings. I assist all of my buyers, including Gen Z, in submitting strong offers that stand out against others. This includes such options as price escalations, deadlines, letting the seller pick closing/possessions date and title company. Sometimes, an offer can win of you let the seller close on a date they choose and rent back the property for a week or two. There's a lot of options to make your offer more competitive, and these terms (sometimes not price) are the difference between a decent offer and a winning offer.

The bottom line is there are still buyers from all generations who are having success in this market. I'm equipped to help anyone win and find a great home. Please don't hesitate to reach out if you have any questions.