The increase in real estate investment in the last few years has not gone unnoticed. As the millennials (also referred to as the generation Y) continue to age, so does their transition from renting real estate to buying real estate keeps increasing. This is owed to many reasons which can be demographic, social as well as economic. Below are four reasons for the surge in real estate investment by the generation Y;
Increase in population
The world population over the last 100 years can be said to have more than quadrupled in size with the bulk of this population being the millennials because there was high birth rate around the early eighties and the late nineties. Therefore, this high population of the millennials has driven them to seek for real estate. This is also responsible for the fact that most real estates are situated in areas where the population is high or locations where forecasts on population growths are high. With the rising population demand, real estate is only going to increase, and this serves as good news to real estate investors and agents.
Marriage and starting a Family
According to studies close to half of the population of the millennials are married or have been married before in the United States of America. Although they might be young, most married couples like to have their own space, and this can be noticed in the “house buying trend of married couples. Millennials in the married category tend to seek larger apartments as they prepare for their future family. According to reports, this category prefers to buy rather than rent real estate.
Source of passive income
The need to have more than one stream of income is also a major push for the rise of the millennial’s investment in real estate. In order to gain some amount of financial security, some millennials are investing in real estate.
Although investing in real estate is a promising venture, it is reported that most millennials that made a recent entry into the real estate business have one or more regrets due to inexperience. It is important for millennials to seek expert advice so as not to incur a loss.
The turn of economic conditions for the better since the last recession, which affected the millennials a great deal, has opened fertile ground for investing amongst the millennials as there is an increase in job security.
It should be known that the economy has a direct influence on real estate activities, whether it is in the building, renting, or the buying of real estate. When there is slow economic growth, investment is bound to be slow. Therefore, the economic space is favorable for investment, and the millennials are at the forefront of this venture thanks to favorable economic conditions.
In conclusion, the increase in investments on real estate by the generation Y has come, and it is here to stay for many reasons as they constitute a large part of the world’s population and are fast becoming the world’s working class as the generation X are approaching retirement.
Therefore, it is important for stakeholders in the real estate business to understand these facts and treat the millennials as a priority group also noting their habits in relation to technology, politics, and business.