This insight is based on behaviors of demographic segments in real estate transactions. We looked at behaviors of five different segments – Gen Y, Gen X, Younger Boomers, Older Boomers and the Silent generation. The insight may be intuitive to many of you – Gen Xers are the most valuable demographic to Real Estate Agents.
Before we go deeper, let’s look at how these age based demographic segments are defined.
Gen Y = 34 years and younger
Gen X = 35 to 50 years
Younger Boomers = 51 to 60 years
Older Boomers = 61 to 70 years
Silent Generati years and older
Now, back to the point – Gen Xers are most valuable because:
- Gen X constitutes largest segment among both Buyers & Sellers
- They tend to buy higher value homes
- Many of them are buying [new home] and selling [old home] at the same time
- More importantly, they tend to use same Real Estate Agent for both [buy & sell] transactions
Gen X constitutes largest segment among both Buyers & Sellers:
Gen Xers are 30% of Buyers and 29% of sellers - and that is biggest demographic among Buyers and among Sellers.
Gen Xers tend to buy higher value homes:
That is, median value of homes Gen Xers buy tend to be higher than median value of homes other segments buy.
Remember - when we say higher value homes, that only represents Buy side of the transaction.
Many of them are selling old home to buy new home: 41% of Gen X Buyers reported owning a previous home vs. only 18% of Gen Y reported owning a previous home.
More importantly, they tend to use same Real Estate Agent for both [buy & sell] transactions:
True value for a Real Estate Agent is when customers use them for both buy & sell transactions - 59% of Gen Xers reported using the same agent. That is the single biggest factor that makes this generation highly valuable. While 62% of Gen Y seems to use the same agent, remember, only few of them previously owned a home.
Size of Gen X population, their propensity to buy higher value homes and their need to sell old home to buy a new one make them highly valuable to an Agent.