Toronto is a world class city, with seemingly endless opportunities for career, social and personal growth. For millennials, it’s one of the few places in Canada where those in need of a big-city lifestyle can comfortably call home. With new pockets of Toronto developing at a rapid pace, it’s hard to come by a vantage point that doesn’t include at least one towering crane in the sky. In fact, new condo sales are currently surpassing resale, with 12,138 sold in Q2 (that’s an increase of 62% year over year!). It’s safe to say that residential pre-construction is truly a booming industry in Toronto.
It feels as though new projects are announced daily, and neighbourhoods that people were once weary of walking through after dark have become safer, family friendly communities teeming with amenities (take the Regent Park revitalization, for example). Regardless of the borderline propagandist headlines about the real estate market, there are more places in this city to live than there’s ever been before – and the majority of those looking to fill those places are millenials.
Though their needs and lifestyle expectations differ from those of their parents in some ways – for example, they value travel and flexible work hours over saving for retirement and other costly expenses such as having a car – millennials still value home ownership. According to a Huffington Post article from April 2016, two thirds of millennials surveyed in the Toronto area expect to be able to own their own home, despite the climbing real estate prices.
Although this generation is truly fascinating in more ways than one, let’s focus on consumer behavior.
Millennials are incredibly savvy. They are highly educated buyers who put more research into their purchase decisions than any other demographic. An analysis by Goldman Sachs earlier this year discovered that rather than choosing the most convenient option, millennials are willing to spend their time waiting for a better deal, or searching for a comparable product that provides better value for the same price. “We see areas where millennials are willing to spend, but overall, they’re not levering themselves up to make their dollars go further; they’re being much smarter and much more conservative about their balance sheets” states Lindsay Drucker Mann of Goldman Sachs Research.
So how does this affect the real estate industry, and how can developers appeal to this new wave of home buyers?
A pushy sales approach won’t work.
Millennials are set in their values, and are less likely to make a lifestyle sacrifice for a “good deal”. A 2016 survey conducted by the Bank of Montreal found that only 14% of Toronto buyers would consider purchasing a property if it meant moving outside their preferred area, and 73% would delay making a purchase in order to get the home they want.
This generation is in no rush to become homeowners, so rather than creating an air of urgency when selling, developers need to create value in other ways. For example, having amenities that make commuting easier– such as a car sharing program within the building and a daycare centre on site may convince a young family to move outside of their favourite neighbourhood if they knew purchasing a new home would provide a solution for their further trek to work and additional hours away from their children.
Create an experience.
When it comes to the millennial generation, authenticity is key. This generation does not want to be “sold” to; before they spend their money on a product or service they want to experience what a brand has to offer. They have a clear set of values – like transparency and social responsibility – and they are more likely to purchase from a company with core values aligned to theirs.
Take Curated Properties’ latest project, The Plant in West Queen West. Located in a trendy area with a higher than average price per square foot, The Plant delivers value by selling a lifestyle experience, not just a condo unit. Instead of incorporating amenities like an indoor pool and a movie room, the development caters to the environmentally conscious, food-savvy individual by having an onsite greenhouse/nursery, an industrial grade kitchen for food preparation and events, and bicycle parking. This type of forward-thinking is something we as marketers can get behind, an expertly catered project that matches the lifestyle, values, and wants of the target demographic.
How does this help developers? Rather than selling a product, you need to show how each aspect of a project comes together to form a lifestyle. A two-bedroom unit isn’t just for extra space; your brand new home office is the perfect base for your journey into entrepreneurship. The on-site indoor pool? Your post work week sanctuary. The party room isn’t just an amenity; it becomes a place where your closest friends and loved ones come together to celebrate a milestone.
It’s not what you sell, it’s how.
You’ve got an incredible product with an awesome brand, and gorgeous renderings. Now how do you get millennials to pay attention? Start by picking up the phone.
According to a National Association of Realtors report earlier this year, 58% of buyers aged 36 and under found their homes using a mobile device. Though an excellent sales team is important, almost all buyers (regardless of age) turn to the internet as their first step in looking for a home. As a developer, your web presence needs to be polished, relevant and current. And this doesn’t just mean having a mobile-friendly website. Frequently updated content, testimonials from people who have purchased from you before (or aligned with your values and vision), and easily accessible project information are key when developing a digital marketing plan.
Millennials trust their peers, and those who have similar lifestyles and values – in fact, 98% are more likely to engage with a post from someone they know over a brand’s post on social media. It’s important to make connections with who you’re selling to, and establish open and honest lines of communication. Be responsive and knowledgeable, you want to sell yourself as a reliable resource, not just a product.
Now that you’re armed and ready to sell to this generation of home buyers, you’ll need an awesome team to make it all come together. Did we mention that we’re pretty much experts on millennials? As the saying goes, it takes one to know one. If you’re a developer looking to expand your audience and blow the sales for your next project out of the water, we want to help.
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