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2008-10-14 23:26:37

Gen X IS the Market

Do you work with buyers or agents between 27 and 43 years old? According to NAR, that Gen X demographic comprises approximately 25% of Realtors® while Gen Xers make up over 55% of homebuyers. What do you need to understand about generational profiles to recruit and retain Gen Xers? And what do your agents (median age 52 year old Boomers) need to know about working with GenXers?

Generational Differences
It has long been known that people are strongly influenced by major events that occur during their developing years. The traumatic events of Vietnam, civil rights demonstrations, feminism, and the sexual revolution dramatically influenced, and even defined, the Baby Boom generation, just as World War II and the Depression defined the G.I. generation. While the boundaries between generations may be a bit fuzzy, there is no doubt that generational patterns have pervasive effects on aspirations, values and life styles, and in the process, on what consumers seek when in the real estate market. Let’s look at Gen X patterns.
Gen X Influences
Gen Xers grew up in a society that was largely influenced and run by Boomers whose intense lives they often reacted against. Many found their “liberated” parents focused on careers and causes at the expense of families. Their parents had the highest divorce rates in history. Most Gen X kids grew up in single-parent or double-income homes. The child-rearing theory of the day stressed giving kids decision-making power and “not stifling them with rules.” Without a high level of nurturing and emotional bonding, they became skeptical, with an inclination to be independent. Some were forced into adult roles in dysfunctional families.
Gen Xers were growing up during the deterioration of social, religious, political, and business institutions, which contributed to their disillusionment and distrust of authority. Many saw the effects of globalization and the information age on their own parents as manufacturing jobs, and later white-collar jobs, began to move overseas. This was the world that loomed large as they went off to college or otherwise prepared themselves for the changing job market. Today’s financial turmoil will likely add to both disillusionment and distrust.
Gen X Characteristics
As a generation, Gen Xers tend to be independent (“you are not the boss of me”) and to want choices (they are used to website drop-down lists). They want to be decision makers but fear making the wrong decision. Some experts refer to this as “decision paralysis.” They want instant response: they grew up with fast food, FedEx, and one-hour photos.
They, more likely than their forebears, focus on the overall quality of their lives. Many place family above everything, relegating jobs to second priority. According to a Radcliffe Public Policy Center study, 71% of men were willing to sacrifice pay to spend more time with their families. For the Gen Xer, home is what balances life and reflects values and aspirations.
Growing up, Gen Xers learned not to expect job security, and that has been reinforced by the current turmoil. However, they have wanted satisfaction in their jobs and have not been reluctant to change jobs to find it. Gen Xers often look for jobs with flexible hours, job sharing possibilities, telecommuting, video conferencing, parental leave, or at least, with shorter commute times. A virtual office setting is ideal for this group.
Gen Xers As Buyers
Gen Xers have delayed marriage (median age of 27.1 years in 2003), as they have sought to get established. Yet owning a home has been a priority with them. The median age for the first-time homebuyer is 32. And the definition of “entry level” for this generation has changed; they have been unwilling to settle for the “starter home.”
What do Gen Xers look for in a home? Given their emphasis on family, they tend to focus on rooms for family living, rather than on formal living rooms. They want the family to be able to spend time together. The “Great Room” is popular with them, and may include the kitchen with an island, an entertainment center, a computer center, and space for other activities that the family can share. They may also be contributing to a resurgence of growth in the urban core, fueled by a desire to reduce commute times as a means to increase family time. The definition of “urban core” may also extend to the “suburb within the suburb.” Large yards have often given way to courtyards, where there can still be family entertainment/outdoor kitchens, but with less care (they love to hang out with friends and socialize during their leisure time).
Gen Xers have learned through painful experience to distrust institutions and government programs, such as Social Security, and have been more skeptical than were Boomers of depending on inheritance for future security. Having seen the pension plans that their parents depended on being modified or disappear, they have frequently regarded their own personal investments as their hedge for retirement. They have pushed for retirement savings plans with portability so that they can more easily make job transitions. Often, their homes, too, were seen as an investment in future security. It remains to be seen how the steep decline in housing values over the past few years will affect that perception.
How should real estate agents work with Gen X buyers? First, recognize that they will likely come to their sales professionals well informed. A 2005 NAR survey reports that of the 77% of potential buyers who searched the Internet, 42% were under 35 years old. Websites should be creative and imaginative—don’t forget that this is the MTV generation. Websites need to give value, not a sales pitch—they grew up on commercials and blatant consumerism and they recognize it when they see it. A website needs to have quick access to information.
Gen Xers are the first generation to embrace the full potential of the Internet. They may be going 100 MPH on the information highway but they still need help reading the road signs. They look for value in services and are willing to pay for it. They want choices. Services should not be “one size fits all.” Gen Xers want to see the value of a transaction and how it can fit into their financial future. Gen X consumers expect to access their transactions, reports and documents online 24/7.
Gen Xers As Agents
Gen Xers tend to be impatient, to put a high value on their time, and to show little tolerance for having it wasted. They relate to virtual realities, which is to say that the concepts presented must have relevance to what they can see, feel, and experience. They show little respect for authority. Doubting tradition is a virtue, a way of engaging for them. They were certainly not taught using “rote” memorization. They do not focus well on “logical steps” leading to a conclusion. The print medium that encouraged linear thinking is not their medium. They are more comfortable with one-on-one training, coaching and mentoring.
Gen Xers are independent but are willing to work in teams. They resist hierarchy and prefer to be egalitarian. Work must be rewarding and compatible with family time. They are fun loving and bring diversity to the workplace.
Time is precious. Avoid long meetings and get to the point. Forget the “war stories” and anecdotal reports. They are self-motivated and prefer that you teach skills instead of micro managing. Make them part of the office process. They want to be included.
The brokerage must support new technologies and offer dynamic websites. Introduce market strategies and promote niche marketing. Encourage business planning and budgeting. Teach negotiating skills, advocacy (agency duties), and investment strategies. Understand that if the work is not satisfying and rewarding, they are likely to move.
Whether your relationship with a Gen Xer is as their agent or as their broker/manager, it is clear that you will need to overcome their cynicism by establishing a relationship of trust and earned loyalty. This is a fun-loving group that wants to expand their family circle to include valued friends and associates. Be there for them.
(Portions of this article were excerpted from Generational Housing, Myth or Mastery, a book authored by Carmen Multhauf, CEO Generational Housing Council, and Lloyd G. Multhauf, Ph.D)

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