Why More Millennials Are Investing in Real Estate

21 June 2021

Why More Millennials Are Investing in Real Estate

Across the world, Millennials currently account for 23% the majority of the population. Holding the majority population means that the habits of this generation are significant in the shaping of economic trends. According to the recent Real Estate Investing Report by RealtyShares, this demographic has been increasingly investing in real estate, particularly more than other demographics. The question now stands, why are millennials actively investing in real estate?

There are three key trends identified among this demographic that researchers have found as influences in the trend of real estate investment for millennials:

1. They choose to rent properties for years before buying houses;
2. Millennials prioritise technology-integration in real estate;
3. They put their trust in tangible investments; 

With most millennials approaching their late twenties, they are now primed for starting families and buying homes. It is often thought that millennials have waited later than other generations to get married and buy homes because they were invested in succeeding in their careers and paying off their student loans. As they are now of age, they are trending in buying and investing in properties. 

For a generation that stands out for their adoption and use of technology, it is not surprising that Millennials favour technology-based infrastructure in a prospective home. Workers within the Real Estate industry have noticed this trend and the importance it has to the completion of sales to this particular demographic. With Millennials now able to view, put in offers, among other transactions, from the comfort of their homes and on their handheld devices, the entire process of investing in real estate becomes easier and more attractive to them. They are also now able to read more on the process of investing and the importance of real estate as an investment, with a quick Google search. The Real Estate industry becoming more technologically advanced is a key component in Millennial interest and investment. 

Lastly, researchers have suggested that Millennials having lived through and been old enough to acknowledge the effects of the 2008 recession are more drawn to trusting tangible investments. While many are still investing in stocks, Millennials may be more drawn to invest in a tangible thing such as a home or apartment. Many of them see the benefit of owning a home, even if it is used as a rental and second source of income while they continue to rent. Observing the crash of the US stock market and how much it affected investors at the time, may have pushed Millennials to trust more in something that they can point to and visibly say, ‘I own that”, which would make it appear harder for them to lose out or have the investment destroyed. 

Ideally, every situation of investment in real estate will be based on the specific contexts of the individuals investing. However, current trends show that Real Estate is high on Millennials’ lists for investing and as they are a large part of the worldwide population, they may influence future generations and market trends to do the same.