Millennials are expected to take a bigger share in the real estate market five years from now, with their spending power rising to 66.1%.
According to a study conducted by the First National Real Estate, millennials are earning more money than prior generations, boosting their buying budgets above both baby boomers and Gen Xers.
First National Real Estate CEO Ray Ellis said the millennials' real estate spending power will be driven by their lifestyle.
"The next five years will see the most spending power of baby boomers eclipsed by millennials, with the majority focused on buying apartments as their first home - moderate commutes to work will be acceptable but the majority will not find the outer suburbs of metropolitan areas very appealing," Ellis said.Also Read: Millennials need more help from the government in buying a home
He added, "The norm is ‘now I want it, I’ve earned it, I can have it.’ By necessity, the lifestyle changes that are required to become a property investor are no longer mandatory."
For these millennials, their first property purchase is expected to be apartments. Meanwhile, those seeking out landed homes would look for locations that complement their lifestyle, as well as being close to their workplaces.
First National Real Estate is also projecting a trend of buying move-in-ready homes amongst millennials, as nearly half are planning to buy newly-constructed homes to avoid plumbing and other electrical problems.
Internet connectivity is also expected to influence millennial's decision in choosing a property.
Millennials are also expected to hold onto their first home for six years before moving on to the next better one, nearly half the time of the 10 years for previous generations.