A range of factors including economic growth, migration, and time are changing the demographics of the United States and abroad. Are you prepared for your new customers? Do you know who they are? Read on to learn about national demographic trends and ask yourself the following questions as you read along:
How does this trend impact my business?
Do I have the knowledge and skills to serve this population?
Does my team reflect this changing world?
What steps do I need to take to better serve this population?
1. Millennials are projected to become America’s largest generation in 2019.
Population projections from the U.S. Census Bureau estimate that millennials (born 1981-1996) will overtake baby boomers (born 1946-1964) by 2019 as their population swells to 73 million. This demographic shift is being reflected in the housing market. In 2017, millennials accounted for 36 percent of U.S. home purchases, while boomers were at 32 percent, according to the National Association of REALTORS®.
2. The United States is becoming more racially diverse.
According to the U.S. Census Bureau in February 2018, the estimated United States population is 327.16 million and the majority demographic is Caucasian – but not for long. By 2055, Caucasians will comprise 48 percent of the total population, according to Pew Research Center, and 24 percent will be Hispanic, 14 percent Asian, and 13 percent African-American.
3. More people are living in multigenerational and shared households.
A report released by Pew Research Center showed a growing trend toward multi-generational and shared housing. In 2016, 20 percent of the U.S. population (64 million people) were living with several generations of people in the same home. The report also showed that multi-generational housing is growing among all racial groups.
In 2017, 32 percent of the U.S. population (76.8 million adults) were living in shared housing arrangements. According to Pew Research, “a shared household is a household with at least one adult who is not the household head, the spouse or unmarried partner of the head, or an 18- to 24-year-old student. (Most multi-generational households are also shared households.)”
4. Hispanics are the majority minority.
In 2017, the U.S. Hispanic population increased by 1.1 million – the largest population growth compared to any other demographic in the country. More than half of the total 58.6 million Hispanics currently live in California, Texas, and Florida. However, Kansas, Utah, and Iowa have recently seen large increases in Hispanic population growth.
In February 2018, the National Association of Hispanic Real Estate Professionals (NAHREP®) released the 2017 State of Hispanic Homeownership at its Housing Policy and Hispanic Lending Conference wherein it reported that 7,472,000 Hispanics owned a home compared to 4,242,000 in 2000. Even more significant is that Hispanics are the only demographic to have increased their rate of homeownership for the past three consecutive years.
5. Motherhood and family size are up after years of decline.
Women are having more children. According to Pew Research Center, women in 2016 had, on average, 2.07 children during their lives – up from 1.86 in 2006, the lowest average record. Additionally, among women at the end of their childbearing years (40-44), 86 percent had given birth by 2016, an increase from 80 percent in 2006.
What does all of this mean for real estate agents?
While these national trends matter, it is even more important to stay plugged into demographic shifts in your local market. Without intimate knowledge of who your clients are, you will be unable to serve them at the highest level and evolve your business to meet their preferences.
“Research your market area for statics on population changes. You can do so by contacting your chamber of commerce and city, county, and state governments,” advises Kacy Bell. Bell, a 30-year REALTOR® and certified Fair Housing instructor, has dedicated hundreds of hours to teaching real estate agents about the importance of diversity and fair housing.
From there, you can prepare to seek out opportunity in each population.
“For example, in the next 30 years there will be a significant increase in an aging population. This opens up the door for you to guide seniors through the process of downsizing into a smaller space or entering a care facility. With this knowledge in tow, you can seek out education and training to give you the knowledge and tools to guide this population through the financial and lifestyle changes they are facing.”
By learning and embracing diverse demographics in your local market, you will be poised to succeed and be the agent of choice.