A Different Type of Millennial

Demographics and Millennials 

Not All Millennials are alike in how they view housing needs.

I did an open house in Edison Township NJ and observed that due to the demographics of the specific area, most of the people coming into the house to take a tour were of Indo-Asian heritage, average age in the 40's to 50's with a pretty much established family size. The house was fully renovated and expanded to a five bedroom home, approx. 2400 sq. feet and built for a large family in mind. So far so good. (not really). What was not taken into consideration was that large families are not made up of just parents and children. Households for homes this size are made up of Parents, Grandparents and grandchildren (sometimes great grandchildren) and a form of communal living is more the norm than the exception. The older Grandparents need to be on the first floor, to avoid climbing up stairs and make it easier for them to get around inside the home.This is not uncommon within this demographic, where the buyers are somewhat driven and successful professionals or business owners, preparing for their children to go to college and eventually returning home afterwards to start their careers, find a spouse and eventually expand the family (always migrating back to the parental home). The thought is that with the anticipation of family expansion (and staying close together) and aging parents, in this case becoming grandparents, a home like this would be ideal to grow into for the long haul. 

I had the pleasure of meeting with a young couple, who seemed to be in their early 30's at best with no children in tow and was pleasantly surprised to get their take on why they would look a a house this size. I asked for honesty and they were nice enough to share their thoughts with me on the down side of the homes they had seen (as well were in). They were looking at starting a family of their own as well as facing the reality of older parents coming to live with them in the near future, knowing that it would be expected of them. Millennial's, in this culture, are marrying later, in order to go into a relationship better established financially, but with that, there is a sense of duty or even obligation to the parents to keep the family close together as they grow older, in order to give them the personal care they would eventually need. I was impressed that even though these were young professionals getting on with their lives, the bonds of family were still kept strong and duty to the family is done naturally and without question.

This isn't only something seen in the Indo-Asian communities, it's actually the norm for most Euro-Asian ethnicities, housing needs are shifting back to the large family home, especially for families migrating from other countries (1st and 2nd generation nationals). Most families come here to start a new life in this country, working hard for little money and no benefits to support their children who came with them, building on the value and resources of a close knit family. Today we see the American millennial's quite differently. We see them as well educated, career focused, high-tech and so on, striking it out on their own and each man for themselves.This is a great definition for second and third generation Americans that may have detached from the family hub because the family has already risen to some level of socioeconomic stability from previous generations, but not for the new arrivals from foreign lands looking to reestablish themselves here, in this new land legally. Yes, they are driven, hard working and focused, but all the efforts, of all the family members, are always brought back to the family head of household so they may prosper as one unit, taking care of each other financially and emotionally. This is how they can afford to buy these large homes.

Builders, Architects and contractors, pay close attention to the following. Baby Boomers make up a considerable part of the population and most of them had all to do to raise a family and try to get their children into higher learning institutions. Most of the Baby Boomers were faced with a roller coaster of economic highs and lows and many didn't plan for old age too well either (especially first generation that may have arrived later in life). At the end of the day there wasn't much left over to plan with. That being said, as parents become grandparents and start to become unable to keep up with the changing times around them as well as possible declining health, they become more dependent on their older, more established children to get them through this phase of life. 

What I'm getting at here is that most homes built in suburbia were colonial or cape style homes with bedrooms on the upper level and basement laundry rooms, built for the ideal family consisting of just mom, dad and two kids. Today's buyer, in this family centered culture, is better described in the preceding paragraphs and the need for the first floor suite (with bathroom) for the grand parents and laundry facilities on the main bedroom level are in high demand.Without question any builder who is doing rehab construction or even new build, keep this thought in mind. Larger homes are making a comeback to families as described here, but don't forget these two must haves when in the design phase of your project. As a side note, the basement has become the play room for the children as well as a storage area.

Change the design to fit the need. Change isn't coming, with this demographic, It's HERE.
#millennials #builders #community #realestate #dominickleone #fastrealtysales #dominickleonesellsnj.com #familyvalues

Let me know what you think. Feel free to leave a comment below.

Thanks - Dom.

Let's Plant a Tree

Inspiration is found in many forms. It could be a work of art, a successful person you look up to, or even a notable quote. I heard a quote that really made sense to me and felt a need to share.

"The best time to plant a tree is 20 years ago, the second best  time is NOW"

Looking back at 40 plus years of my adult life and thinking of all the opportunities that have past me by all because I hesitated to "plant a tree" when the time was right, because of fear of the unknown results. In other words, my hesitation cost me opportunities to better myself.

We live in an ever changing world and if you take a look back about 10 years (or even 20), you'll see what I mean. We live in a country that has opportunities all around us, but sometimes we miss the forest looking for the trees. We keep looking for the get rich quick plan, which doesn't really exist. The get rich at a reasonable and projected growth plan does exist, that's why, had you planted your tree 20 years ago and nurtured it properly with good morals, hard work and diligence, it would already be providing an abundance of fruit.

Opportunity is always around, to say the least! Another saying saying is "One Man's Poison is Another Man's Bread". When we were attacked on 9-11 the stock market dropped to an all time low out of fear and confusion. Within a few days, investors were out planting trees in security, airline stocks and more. Needless to say, the smart money that was planted seventeen years ago, has produced quite a bit of fruit for investors today.

The Real Estate Market left some deep scars from 2008. A lot of people lost their homes and fortunes because of banks and lending institutions, over extending loans to people who couldn't repay them. Investors who were able to stay fluid with cash, came out the winners, buying pre-foreclosures, Short sales and Bank Owned Properties, better know as REO's . Unlike the stock market of 9-11, the short sale and REO markets are still offering discounted properties from people who either walked out and dropped off the keys to those who were evicted by the foreclosure process.

We are currently in a real estate market where inventory is low and interest rates are starting to creep upwards. The biggest problem for home buyers is the ability to qualify under the new bank lending rules. Not good for a lot of home buyers that had credit issues from past and current debits (the Poison), but great for real estate investors and Private buyers (who maintained some cash and good credit) who are looking for rental properties to add to their portfolio.

Today, the rental market (the Bread) is still flush with renters and in need of fresh inventory to satisfy the amount of tenants still reeling from the housing downturn, hurricane Sandy and other misfortunes, looking for a good home to start getting their lives back on track.

So, if you see the opportunity to "Plant a Tree" in the real estate market, down the road the tree may just be able to provide some tasty fruit (maybe sooner than 20 years).

Leave a comment or send me an email, I'd love to hear your thoughts. - Dom.

Rental and Second home investments still strong

The market is still in full swing and swinging even faster with the anticipation of interest increases looming in the near future.

Click on the article below and let me know what you think.

What's in Store for the Luxury Real Estate Market in 2017?

Reprint from: RISMEDIA, Saturday, February 11, 2017

— Eight years after the housing bubble, homebuyers are still exercising caution. This is particularly seen in the luxury real estate market, which ended 2016 on a slow note. A combination of oversupply and rising housing costs in cities like San Francisco and New York left buyers feeling choked out. Will the market improve in 2017? Experts have mixed feelings.

"We have seen inventory come back at a steady pace, and buyer demand is strong enough that it will continue to keep the market moving as we go through the next 12 months," David Charron writes in The Washington Post.

But others aren't so sure. Over-development across the country and around the world has left the luxury housing market "soft," according to Beckie Strum at Mansion Global. The result is competition for dollar buyers in the flooded market; however, thanks to the Brexit and other global political upheavals, the dollar is strong compared to other currencies. This means that buyers looking to spend with American money will be able to get even more for their cash.

Rising Mortgage Rates Play a Role
In addition to the increase in both housing costs and supply, mortgage rates are also rising around the country. The biggest jump occurred right after Trump was elected, reflecting a cautious optimism that his presidency would be good for the economy. In addition, in December 20216, the Federal Reserve raised interest rates by 0.25 percent. This is a signal that the Fed is seeing and trusting positive economic conditions: the 2016 rate hike was the second time in a decade that the Fed decided to raise rates.

Implications for REALTORS®
What does this mean for REALTORS®? Higher mortgage rates in the early part of this year could potentially coax more buyers into making a home purchase before mortgage rates get too high.

"We should expect the early part of 2017 to be filled with a brisk pace of not only homes going under contract more quickly, but also taking less time to reach a settlement date," Charon writes, which means that the length of time that a house stays on the market can be expected to drop in the early part of the year.

In addition, as the post-election euphoria wears off, cities like New York could still be faced with a surfeit of available properties. The housing market in the Bay Area is also expected to struggle. Home prices in the area have been steadily rising for the past five years, jumping to $680,000 in December 2016. The combination of high home prices and rising mortgage rates led to a decline in Bay Area home sales at the end of the year.

According to Zillow, home sales will continue to drop on the coasts, while the markets that will see stronger sales will be further inland. This includes surprises like Nashville, where the housing market is blooming as a result of lower rent prices.

Even as renting becomes more affordable, Zillow cautions that construction for new homes may be impacted by the labor shortages that may result from Trump's restrictive stance on immigration.

"A shortage of construction workers...may force builders to pay higher wages, costs which are likely to get passed on to buyers in the form of higher new home prices," according to Zillow Chief Economist Dr. Svenja Gudell.

Comments and opinions welcome.