Generational Trends – Millenials Change Homeownership Rules... And Licensees Glenn E. Crellin Runstad Center for Real Estate Studies University of Washington ARELLO Annual Conference September 21, 2013

Acknowledgments  Principal Sponsors of this research  Washington Department of Licensing, Real Estate Program  Realtor® University Research Center  General Sponsors of Runstad Center Research  Washington Realtors®  Washington State Housing Finance Commission

Generational Trends and Real Estate  Understanding Generations  Population Demographics  Homebuyer Demographics  Licensee Demographics  Demographics and Technology  Demographics and Education

Identifying Generations  G.I. Generation  Born : Age 87+  Silent Generation  Born : Age  Baby Boom  Born : Age  Generation X/Baby Bust  Born : Age  Generation Y/Millennials/Echo Boom  Born : Age  Generation Z/Internet Generation  Born 2001-present

Age Distribution of Population

Era of Renters?  Media suggests Millennials prefer to rent … forever  Mobility  Part-time jobs  Fear of ownership  Student debt  Urban lifestyle  Hasty Generalization

Historical Context  Mankiw and Weil, Regional Science and Urban Economics, 1989  “The entry of the Baby Boom generation into its house-buying years is found to be the major cause of the increase in real housing prices in the 1970s. Since the Baby Bust generation is now entering its house-buying years, housing demand will grow more slowly in the 1990s than in any time in the past 40 years. If the historical relation between housing demand and housing prices continues into the future, real housing prices will fall substantially over the next two decades.”

Recent U.S. Homeownership Rates

Homeownership Rate by Age of Householder

Homeownership Rate by Age Group (Percent) < GISilentBoomX/Bust Y/Millennial

Profile of Washington Home Buyers 2010

Future Housing Plans

Generational Composition of Workforce

Technology is Innate

Usage of Social Media for Business

Licensee Advertising on Craigslist.org

Real Estate Has Low Education Entry Barrier, But…

Education by Generational Cohort of Licensees

Preferred Delivery of Continuing Education