TheMReport — News and strategies for the evolving mortgage marketplace.
Issue link: http://digital.themreport.com/i/1096867
26 | TH E M R EP O RT FEATURE The Great Property Divide Connecting with clients across generations and genders is key to closing America's homeownership gap. The first step toward progress is understanding the needs and priorities of these potential borrows. By AJ Barkley A s winter turns to spring, people begin to reflect on their lifestyle and make promises to themselves—"I'm going to spend more time outside," "this year I'll finally clean out my storage unit," or "I'm going to host my friends more often." The promises I hear the most, however, is often related to their home—"this is the year we upgrade to a bigger place," "I'm going to start that kitchen remodel" or simply, "I'm finally going to buy a home of my own." As experts in the home finance industry, it's important to take a step back and ask who will be making moves this year? What will they be looking for in a home? How will they pay for it? And most importantly, how can I make the process easier for them? The next person that walks through the door may be looking to move to their dream home with space to have their children and grandchildren visit or maybe they are looking to fall back in love with their home by updating it. They might even be the new kids on the block looking to buy for the first time. Homebuyers now span several generations and genders: Generation Zers, millennials, Gen-Xers and baby boomers, male and female, are all taking steps forward in their homeowner journeys. As industry professionals, it is essential to be in-tune with the uniquely diverse situations each group brings to the table—no matter the stage—it is essential to know how to best meet clients' needs and to understand that one size doesn't fit all. Baby Boomers: On the Move A s boomer's head into the next phase of their lives, they are faced with a major question: does their home still fit their needs? According to the U.S. Census Bureau, there are roughly 77 million baby boomers aged 55-73 years old, and for many, their children have moved out of the house and retirement is on the horizon. This could mean looking for a smaller, lower-maintenance home, a larger home to welcome younger generations or even a new home in a warmer climate. No matter the reason for their move, as a trusted adviser, it is important to understand their reasoning and goals so you can guide them through the process and connect them with the right tools and resources. This generation of clients may not be familiar with the digital resources that are available to them, such as mobile mortgage applica- tions and tracking tools. To facilitate a more enjoyable and efficient experience, be sure to introduce boomers to these self-guided resources where they can get comfortable exploring options on their own time. Once they get acquainted, they will be able to take advantage of efficiencies that might not have existed the last time they purchased a home. However, not all baby boomers are looking to move. Some may be looking to hold tight to the memories and traditions that have been established in their current home, but they want to make changes and updates. When moving to a new house isn't the right fit, remodeling can be a great option. Maybe it is opening and expanding the kitchen to connect with the living room so that everyone can be together during family gatherings. If this is their path, then they may be taking a page out of the Gen-Xers book. Gen Xers: Staying Put, But Making a Change G en X is often overlooked since this group is signifi- cantly smaller than other generations. However, in their peak earning years and with more spending power than any other generation—according to digital marketing group Centro— they're not a group to dismiss. Gen Xers are in a different life stage compared to other genera- tions as the majority are married with an average of 2.5 children, according to Eclipse Marketing Services. With growing families and changing needs, many Gen Xers are considering how they can make their current homes better fit their families. In addition to personalizing and adding value to a home, remodel- ing can be a great alternative to moving—especially for those that love the perks of their area, such as a great school district or proximity to friends and family. Beyond making aesthetic altera- tions, this generation is also considering their future needs when planning changes to their home. They want to make it work for their lives now and in the future to bring resale value if they decide to move. However, when it comes to how to fund these home renovations, many Gen Xers aren't aware of the financing options available to them, such as home equity lines of credit (HELOC), which can be an affordable and flexible option.