Developers presented two very different profiles of Millennial first-time buyers at the CMHC conference in Toronto Tuesday -- both absolutely key for brokers to understand as they head into 2014.
Dave McLean, president, GTA Homebuilding at Matamy, and Peter Zimmerman, director of development at Freed Developments, specialize in two very different housing profiles and, therefore, target very different customers; even if the customers belong to the same generational group. They answered a moderated Q&A to give the audience a glimpse at the buying habits of first-time millennial (echo boomer) buyers.
It's worth noting that Mattamy specializes in suburban communities that feature freehold, semi-detached houses and townhomes while While Zimmerman's Free Developments specializes in high design, urban condos.
Housing type demand
Dave McLean: “For the most part it’s traditional single family homes.”
Peter Zimmerman: “First time buyers are price-point sensitive… we’re trending down to smaller suites.”
Dave McLean: “Echo Boomers, for us, are usually couple and usually mult-generational, not a lot of single people. Often it is a couple with a parent who is buying with them.”
Peter Zimmerman: “We have a very different market. Most of our customers are single individuals; first-time buyers in the 25-35 age range… and investors.”
The parents’ role
Dave McLean: “Definitely a financial one. It seems more and more often, even in the sales offices, buyers bring in their parents.”
Peter Zimmerman: “We don’t track it but I think, anecdotally, we have a number of parents who come into the sales office with young buyers.”
Years spent in first house
Dave McLean: “They’re not going to stay there long… they are going to move up; often in the same neighbourhood, due to family growth, careers. People will buy entry-level homes and they will follow us (and buy up).”
Peter Zimmerman: “I’d say it’s not always the case but, for the most part, someone who moves into a 500 square foot condo will want to move out… and couple up and have kids (often within 4-5 years). Five to ten per cent of our buyers are repeat buyers.”
Dave McLean: “ We understand there are investors who purchase from us but we try to discourage them. (They) affect curb appeal (and quality of the community).”
Peter Zimmerman: “I don’t think investors have had a negative impact.”