Millennials to Drive Down Home Sizes

January 27, 2015

The younger generation will make their mark on the look of homes in the coming years as homes likely will get smaller, separate laundry rooms will become essential, and home technology will be a must, according to a panel of builders and designers speaking at the International Builder Show last week.

A growing number of first-time buyers will likely lead to smaller homes -- a downsizing home trend that may start showing itself even in 2015, predicts Rose Quint, the assistant vice president of research at the National Association of Home Builders.

As younger, first-time buyers re-emerge on to the market, “they will demand smaller, more affordable homes,” Quint says. “Builders will build whatever demand calls out for.”

NAHB recently surveyed millennials on what home features they “most wanted” in a home. Here are some of the features that topped their list:

  • A separate laundry room: 55 percent of millennials said they wouldn’t buy a new home that didn’t have one
  • Storage: linen closets, a walk-in pantry, and garage storage
  • Energy efficiency: millennials said they are willing to pay 2-3 percent more for energy efficiency as long as they see a return on their power bills

What would they be willing to sacrifice? Millennials surveyed said they’d sacrifice extra finished space or even drive a little farther to work, shops, and schools in their home purchase. However, they aren’t willing to compromise with less expensive materials in their home, the survey found.

Seventy-five percent of millennials surveyed said they want to live in a single-family home, and 66 percent said they prefer to live in the suburbs. Only 10 percent said they wanted to stay in the central city.

Since millennials tend to be more cash-strapped than older home owners, they often seek less expensive, low-maintenance choices in a home, such as landscaping that needs less watering and mowing and larger patios instead, said Jill Waage, editorial director for home content at Better Homes and Gardens, which also regularly surveys buyers on home preferences. Millennails are often very tech savvy, and increasingly are asking for ways to control their home’s heating, air conditioning, security, and lighting from their phones or tablets.

“They want to use their brain for other things, not for remembering whether they adjusted the heat or closed the garage door,” Waage said.   

Source: National Association of Home Builders