The millennials…redefining the American dream
Millennials demand more affordable options and are predicted to create their own category
Millennials make up the nation’s largest living generation. Already at 76 million, their numbers are expected to peak in 2036 at 82.1 million, surpassing baby boomers by nearly 3 million, according to the U.S. Census Bureau, April 2016.
RMG President and CEO John P. Clarke says developers planning to serve this market along the Front Range in Colorado need to consider that by 2022 this generation will be the driving force behind the new economy, controlling the majority of the economic growth factors in the state that will impact residential home markets.
Unlike their baby boomer parents, millennials have taken advantage of the personal and professional opportunities afforded by a global economy and digital connectivity. They travel more, purchase more, change jobs more, obtain more education, develop relationships far differently, and will share more personal information with the world than any previous generation.
However, when it comes to buying a home, many millennials are caught in a catch-22. Though they associate buying a home with the “American Dream” more than any other generation, the homeownership rate for Americans under age 35 is near record lows at just 34.7 percent. Meanwhile, the number of millennials living with their parents has increased nearly 15 percent from 2006 to 2013.
Current median home prices in Colorado are out of reach for this group. Many are unaware of the different financing options that exist — particularly those that allow for a down payment of 6 percent or less. Regardless of financing, millennials are demanding that more affordable options become available and more likely than not, will create their own category.
“Through countless hours of research, meetings, and discussions with local economists and professionals, we have come to the following conclusions”, said Clarke.
Millennials list of demands includes:
- Smaller Size- Smaller carbon footprints – a core value of this generation.
- Natural materials – Millennials desire natural materials such as stone and glass that bring in natural light.
- Clean lines – The overall design scheme popular with this age group is still essentially modern, incorporating simpler designs with cabinets that are lower, with clean lines, and without ornate fixtures.
- Sustainability – Solar on rooftops with Tesla power walls will become a standard in the near future. Appliances that are high-efficiency and materials that are environmentally friendly are both rising trends.
- Functionality – In addition to sustainability, millennials are focused on items that will be durable and serve clear purposes in home organization such as integrated or hidden cabinets and well-organized closets featuring lots of cubbies and hidden foldout shelves.
- Decks and patios – Millennials want homes with options for outdoor entertainment and living space – to the tune of 59 percent of respondents, according to a survey by Pew.
- Color – Colored LED lights in the shower, fireplace and above-kitchen cabinets can be controlled with an app.
- Smart technology – Throughout the home, there is an overarching trend toward technology integration, from apps that control the stair LED lights, to NEST thermostats that track the heating and air conditioning patterns – and then deliver that information directly to a smartphone.
- Other tech - Automated shelving, fans and lights that turn on and off by sensor, and door locks that can be operated remotely from your phone or tablet, should be considered.
- Collaboration - Neighborhoods and homes that promote personal privacy and still allow for community gatherings are essential.
Clarke continues: “RMG is actively pursuing this demographic as we realize this generation will be driving our residential business in the very near future. We’ve designed an entire millennial community for a client in Denver: Microtopia Ventures. They’ve created a new category of community that is designed specifically to serve this generation: micro-homes.
“Our architects designed each micro home, from 580 square feet to 1,400 square feet, with all of the design and functional attributes millennials desire. By utilizing a mix and match panel type of design, and we’ve created specific economies of scale in the building costs of these units. We also added unique design features to give each unit its own character and appeal without the higher costs that usually go with these types of units.”
RMG designed the commercial sector of the Microtopia community to include an event center and retail, such as microbreweries, restaurants, and a grocery store. The community also includes an urgent care, bike shop, and business incubator. Land planning included a collaborative and functional community complete with neighborhood centers, green houses, walking paths, bike paths, and full community green houses.