Luxury millennial-style is about being edited, authentic, and going high where it counts—and it is reshaping the real estate market
By MARY COOK
Millennials, like their Baby Boomer parents, have brought seismic change to America’s status quo and culture. And one of the most significant industries they’ve transformed—also just like their parents—has been the housing market.
While most millennials rented in their twenties, they bought in their thirties as they began families of their own. And many of them skipped starter homes, instead migrating to larger, million-dollar-plus properties, according to Zillow. Despite stereotypes, a substantial number of older millennials have generous homebuying budgets thanks to inherited family wealth, noted Luxury Portfolio. Higher earning power as millennials age also contributes to this trend, the Washington Post found.
The numbers prove the point. In 2017, Toll Brothers, the nation’s largest luxury homebuilder, reported that almost a quarter of its buyers were under 35 and its average contract price was $837,300, Bloomberg reported. Last year, Toll’s revenues rose to $7.14 billion, a 23-percent increase from 2017, and its average home price jumped 6 percent over 2017, ranging up to $1,899,400.
Higher prices make sense given the demographics. Many millennials are not only older by the time they buy homes, they’ve built greater wealth and want to settle down rather than move several times in quick succession. From our work with homebuilders designing and merchandising model home interiors and amenities (full disclosure—including many of Toll Brothers storied homes), we know that millennial buyers also do far more extensive research than previous generations about every aspect of the homebuying process. So when they’re ready to buy, they know exactly what they want and have high standards.
So what do they want? Homes that are far more well-appointed yet clean-lined than what their parents bought decades ago, equipped with top-of-the-line appliances, finishes, fixtures, lighting, and the latest smart tech in everything from those appliances to the audiovisual and security systems. But psychographics tell us that well-appointed isn’t enough. These buyers are incredibly specific about what they want, aren’t willing to settle for less and will pay top dollar to get it all.
Still, they are far from materialistic and acquisitive. This generation is committed to doing more and having less. Unlike their predecessors, they have no need to own everything. They’ve been comfortable renting everything from dress clothing and gear (be it sporting equipment or furniture) to homes, cars, and rides. Forbes calls this the “rentership society.” Where consumption is concerned, experiences that make memories and on-demand services for music and more have supplanted ownership.
But homeownership has presented us a new wrinkle in this equation, for millennials are now showing us they want high-quality, beautiful homes that reflect themselves. Yet their preferences reveal their values. They want furnishings, fixtures, appliances, and finishes that help them streamline life, save money, and leave less of a footprint so they have more time to do the things they want to do.
That means builders and developers must optimize their offerings at every level. As commercial interior designers, we’ve done extensive research and gleaned deep marketplace experience from merchandising model homes and amenities for the most successful new projects in the country. Here are the top five strategies we use to appeal to millennial homeowners:
Size right: Stats on right-sizing for the millennial luxury market are just emerging and vary wildly. But 2017 research from NerdWallet and Trulia were prescient when they reported that “not buying a bigger house” that had enough bedrooms, bathrooms, and a backyard was all homebuyers No. 1 regret. But it takes more than square footage to size-right; layouts must make smart use of every square foot. We focus on making every space in a home open-concept, multiuse and flexible so millennials can alter them to fit their needs. Bedrooms must be just as mutable as living rooms, kitchens, and dining areas.
Design light: Millennials’ thirst for high-end in everything is more a reflection of their desire for fixtures, furnishings, appliances, and finishes that are not only beautiful but highly functional, durable, sustainable, and resilient. They want high-performance options that will last a lifetime (perhaps with tweaking now and then) rather than having to buy something again (which compromises sustainability). Given their preferences, it’s not surprising that the millennial aesthetic is sleek and embraces neutral colors punctuated with pops of bold, statement-making color that is easy, requiring little effort to change out at will.
Be smart: Constant connectedness that streamlines life and creates an ecosystem is the millennial norm. Ultra-fast internet and strong Wi-Fi to fuel networked systems—be it appliances, security, audio-visual, lighting, HVAC, or monitoring—is a requisite. We focus on finding superior-performing, shrewdly designed products in every area to meet millennials’ high standards.
Get efficient: Earth-friendly features are good for the environment, energy- and resource-efficient, and often save money. Think solar power and air and water purification systems, geothermal heating and cooling, tankless water heaters, sustainable and renewable building materials, and more. But we are attuned to one emerging reality: millennials are so environmentally and socially conscious they’ll choose one brand over another if they perceive it has a better reputation based on ESG—the environmental, social, and governance aspects of its maker.
Go outside the box: Millennials not only want to expand their living areas beyond the walls of their homes—they want it all, from space for alfresco working, dining, and entertaining to pools, media systems, lighting, and activity areas (especially in urban areas, where green space is at a premium). Rather than a trend, this is a new reality that is here to stay and raises the importance of outdoor spaces exponentially—even balconies, decks, and rooftop gardens. Optimizing outdoor spaces to be flexible, multifunctional, and spectacular is one of our top priorities when we merchandize model homes.
Mary Cook is the founder and principal of Mary Cook Associates. She may be reached at www.marycook.com.