Ride share programs such as Uber and home share programs such as Airbnb are changing the way that millennials and other generations think about owning versus borrowing. I find this topic to be ever more interesting as a Millennial, reason being that the landscape for the way we think of homeownership might also be due for a shift. Millennials are noted for creating an experience economy, meaning that rather than money being spent on material items, they are spending money on experiences. It’s not just quick experiences however that Millennials are seeking, but rather basing their career decisions on the ability to combine business with their leisure travel.
Now, why are Millennials seeking this type of environment while other generations have not? There are a number of answers one being that Millennials are pushing responsibilities such having children, marriage, and homeownership further out than previous generations. It’s not that they don’t want this, it’s that as opposed to a goal, it sounds like a dream that might never happen. In 1970 the average age for a woman’s first child was at the age of 21, in 2013, this number jumped to 26 years old, meaning that the priority to have children at a young age is less than it once was. Let’s not forget the increase in the average lifespan went from 72 years in 1970 to 82 years in 2014. So while home ownership, getting married and having children might have been something that happened at a younger age, there is almost a gap between the age group of 20-30 which once was not there.
While there are many reasons for this I believe it’s largely due to the mass amount of student debt that many are coming out of College and University with, in the United States the average student debt coming out of College sits around thirty-seven thousand dollars. Not to mention that this doesn’t guarantee a paid career. In 2016, The Globe and Mail published an article stating that of 40% of highly rated Colleges in Ontario only one-third of graduates find a career after six months. As opposed to spending finances on a down payment for a home which you are tied to, Millennials are seeking ways to spend their money to experience the world at a much lower cost.
So what does this mean for homeownership among Millennials? As a generation, the idea of homeownership might not be as top priority as it once was with previous generations. While homeownership is equally as important as it has always been, developers and builders need to consider the needs of young home buyers in order to tackle these issues. Creating an environment for Millennials which they can gain an experience from their home as opposed to simply the material possession might be a way. Where I find this to be most interesting is considering that Urban living is ever more important to Millennials than any other generation.