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A real estate group has predicted over the next five years, Millennial spending on real estate will overtake the spending by Baby Boomers, with statistics showing 66.1 per cent of Millennials preferring property over lifestyle.
First National Real Estate CEO Ray Ellis said that the next five years will see the spending power of Baby Boomers eclipsed by Millennials, with the majority focused on buying apartments as their first home.
“Moderate commutes to work will be acceptable, but the majority will not find the outer suburbs of metropolitan areas very appealing. In essence, Millennials are driven by lifestyle,” Mr Ellis said.
“The norm is now ‘I want it, I’ve earned it, I can have it’. By necessity, the lifestyle changes that are required to become a property investor are no longer mandatory.”
Millennials are expected to purchase apartments as their first property and seek out homes in locations that complement their lifestyle and are close to transport facilities and their employment.
They will also seek out property that is “move-in-ready” rather than renovator’s specials, with First National predicting that 48 per cent of Millennials will be buying newly constructed homes to avoid plumbing/electrical problems, compared to 34 per cent of other buyer demographics.
Mr Ellis said that internet connectivity has a significant influence in their buying decisions, with the generation geared to seek out property online that is “picture-perfect, and they regard internet speeds and choice of telecommunication providers as incredibly important to assessing a potential home”.
“Television lifestyle shows also play a role in their real estate requirements, with current home styling and design trends high on the must-have list,” the CEO said.
“Seeing property only as a stepping stone, Millennials are expected to hold onto their first home for six years before moving on to the next better one, compared to 10 years for previous generations.”
An apartment is a personal residence within a house or building occupied by several tenants.
Property refers to either a tangible or intangible item that an individual or business has legal rights or ownership of, such as houses, cars, stocks or bond certificates.
Real estate is a type of real property that refers to any land and its permanent improvement or structures that come with it, whether natural or man-made.