PARAMOUNT MORTGAGE - LENDER'S BLOG

Just when you thought you had learned all you needed to know about selling to your Boomer, Gen X and Gen Y customers, demographers have been busy defining the next generation of home buying customers.

Now, you'll need to become familiar with Hippie 3.0, Reverse Boomerang (Aging Adults Moving in with Children), WINK (Women with Income and No Kids), DINKY (Double Income No Kids Yet), GLAM (Greying, Leisured, Affluent, Married), ORCHID (One Recent Child, Heavily In Debt), SITCOM (Single Income Two Children Oppressive Mortgage) and other groups yet to be defined.

Forward looking builders and members of the Realtor community who attended the recent Pacific Coast Builders Conference (PCBC) got a snapshot of the changing U.S. population and its effect on current and future real estate buying trends.

To continue to define markets in terms of Boomers, Gen X and Gen Y, said conference panelist Rita Lamkin, President of the consumer research firm Preface, Inc., "has become quite irrelevant and we really need to start focusing on the micro markets within those categories."

"Most homes are built with one type of household in mind: a married couple with children," said James Chung, of research firm Reach Advisors, "But such households now account for only 1 in 5 American households."

Many American families are becoming multigenerational households. They're trying to figure out how to live in peace, but the houses don't work for them," Lamkin said.

Typically, such families want to be able to have more privacy, with children having their own bathroom, for example.

Lamkin warns "builders that don't want to spend money on new designs are building the same homes as those in foreclosure now. It makes no sense," she said.

In the past decade there has been a dramatic increase in both younger and older singles, single parents with children, and in cohabiting couples.

Builders and other real estate professionals need to think about how to serve those demographics. How do you make the purchase process better for a couple who isn't married? How do bathroom configurations change with family composition?

Millennials (18 to 29) are entering their peak home buying years. Singles in their 20s have jumped 37 percent in the last decade. There are more 28-year-olds in the world today than any other age.

The United States is on its way to becoming a nation where minorities account for the majority of the population. In 20 states, most of them in the South and West, minorities make up nearly 50% of all people under age 18. "There are now as many mixed-race couples as there are white couples," Chung said.

Millennials are responsible for the "chosen family" phenomenon where a cohabiting couple will sometimes live with one or two roommates. In this communal living arrangement everyone may pool their resources to "go for a high-end, luxury unit," Lamkin said.

The PCBC conference was sponsored by the California Building Industry Association.