Page 50

LYKKEN ON

leadership

Five Important Things to Know About Millennial Buyers By David Lykken s 2015 draws to a close, there are many issues facing the mortgage industry. We are still dealing with the

A

DECEMBER 2015 n National Mortgage Professional Magazine n

NationalMortgageProfessional.com

48

implementation of TRID and the ongoing developments in the regulatory space. We are still anticipating improvement in the economy, hoping that wages will increase along with available jobs. And, we are increasingly spending time considering how different politi-

cians will impact the industry as we draw nearer to the 2016 Presidential election. In this article, I would like to discuss another hot button issue that has overtaken the discussions taking place in the mortgage industry: The rise of the Millennial. Early in 2015, the U.S. Census Bureau revealed that the number of Millennials—or people born between 1982 and 2000—now outnumber Baby Boomers to be the most numerous generation existing in the world today. We used to say “the youth are the future, but now—in a very real way—the youth are the present. The young generation represents more people on the planet Earth than their parents and grandparents. Millennials are becoming our voters, our shoppers, and our workers. Now, we in the mortgage industry have to ask ourselves, “Are we equipped to reach the Millennial market?” In this article, I would like to discuss a few important things to know about Millennials that could help us in answering this important question. The first thing to understand about Millennials—at least for the time being—is that they are experiencing, in some ways, greater financial difficulties than those of their parents and grandparents. Many of the Millennials who are currently at the age to purchase homes were just getting out of college at the height of the financial crisis and those who made it out before were still at the beginning of their careers. As a result, Millennials are off to a slow start as homebuyers. Additionally, the cost of education is rising exponentially, while wages are remaining stagnant. What this means for us in the mortgage industry is that we must be patient with the Millennial market. Burdened with student debt and uncertainty about their financial futures, those who are

potential buyers are probably going to be more hesitant to buy and maybe even more difficult to approve. We can expect longer buying cycles, and we must be willing to invest more time and energy into the process. Increasingly, Millennials aren’t just a market, they are the market. If we are to reach Millennials and keep the mortgage industry thriving, we must be willing to work harder to help Millennials get into homes. Another important thing to remember about Millennials is that they have a different set of values than previous generations. The typical family structure has become much more fluid among Millennials, and the people who share a single home may not be what we conventionally think of as a family. Some people choose to remain unmarried. Some people, both men and women, opt to live alone. Some couples decide not to have children. The list goes on and on—the orthodox rules about what constitutes a family have been thrown out the window when it comes to Millennials. What this means to the mortgage industry is that we can no longer market the mortgage simply as an opportunity to settle down and raise a family. That may work for some Millennials, but it certainly won’t work as well as it did for previous generations. Millennials care about different things, and I believe that homeownership can fit into those values. Home will always be an important part of peoples’ lives … we just need to figure out what it means to Millennials. Since 1982, the first year that marks the generation in which Millennials were born, more information has been created and made available to the average person than

Profile for NMP Media Corp.

National Mortgage Professional Magazine December 2015  

National Mortgage Professional Magazine December 2015  

Profile for nmpmag