Millennials - what they really want in a home
Category Newsletter: Article
Arguably the most exciting time in anyone’s life is at an age where the biggest milestones take place, which is typically between the ages of 20 and 34 years-old. This is the time when many individuals are building their careers and also when this same generation are looking to enter the property market.
With approximately 28.4 million millennials in South Africa, a significant portion will be moving into the property sector, whilst many others aspire to, even-though they may not be in the current position to purchase yet. This begs the question, what is “Generation Y” really looking for in a new home?
Home preferences and current trends
A study conducted by Nielsen, A global research company revealed that the property needs and wants of millennials are parallel to current developments taking place in the urban environment, namely a preference for mixed-use developments.
Convenience is the primary draw-card for mixed developments as it fuses retail; commercial; residential; hotel and gym facilities under one precinct. Millennials are looking to perform various tasks and leisure activities in one central location, without the hassle of travelling long-distances.
This requirement is directly in-line with current mixed-use developments burgeoning around South Africa, more specifically, Cape Town, which is currently transforming at accelerating speeds to meet this demand. Up and coming developments include, Century City, Wescape and The Yacht Club. All three developments incorporate residential, commercial, retail and leisure components to create a “mini-city” for its residents and visitors.
Rent vs buying
Statistics show that home ownership among millennials is historically low and therefore many are choosing to rent in apartments that are close to work and retail. The main reason for this is because they simply cannot afford to buy a home in the current economic climate that is defined by rising inflation, high interest rates and continuous financial pressure on consumers. The lack of financial freedom is also tied into millennials getting married later in life, this means that they do not have two income streams coming in, making it harder to put together a down payment.
Type of millennial
The type of millennial entering the property market is largely from a professional background, who are either entering employment after tertiary education or establishing themselves further in a chosen field. This generation comprises of the future backbone of the South African economy, as they are the junior engineers, accountants, politicians, and the general working-class who will soon take-up senior positions, and thus have an extremely influential role in the property market.
A first for millennials
The new generation of South African millennials entering the property market will be the very first group to have the option of living in a mixed-use development. Such an option is not only growing in popularity, but it seems to be the preferred choice over traditional property types. It will be interesting to see how the local landscape continues to evolve to meet the needs of its populace and perhaps in the near future “mini-cities” will be a key feature of urban societies within South Africa.
Author: Coastal Property Group
