According to IQI, in the years to come, millennials will continue to gain market share and deemed as an important buyer group
By NUR HAZIQAH A MALEK / Pic By HUSSEIN SHAHARUDDIN
SINCE the start of the year, millennials have accounted for 70% of purchases at new housing projects, 53% of subsale real estate purchases and 55% of rentals, according to transaction data from real estate network IQI Global.
Millennials are the most numerous buyers, whereby members of the older generations are less likely to complete a real estate transaction in any given year.
“Millennials are purchasing their first home and are at the age at which they are more likely to conduct a real estate transaction.
“In the years to come, we believe millennials will continue to gain market share, and developers and agents will adjust themselves to better serve this large and important buyer group,” IQI said in a recent statement.
Millennials’ share of purchases at new projects rose to 62% recorded in 2019 from 48% in 2018.
“The states where millennials account for the largest share of new home purchases are Sarawak and Kuala Lumpur.
“In Sarawak, millennials account for 88% of new home buying. In Kuala Lumpur, millennials account for 70% of new home buying,” it noted.
In Sabah, millennials purchase 53% of all new homes that are sold and less than half in Melaka and Penang at 48% and 25% respectively.
The data also found that while millennials are the biggest buyers of subsale property, the younger generation does not have as great a lead as they do with new projects, as millennials account for 52% of all subsale property purchases in 2020 to date.
“2020 to date marks the first time that millennials have accounted for more than half of the subsale purchases.
“As recently as 2017, millennials were only the second-biggest buyer group for subsale property. In that year, they accounted for 33% of subsale property purchases, compared to 48% for Gen X,” IQI said.
This was in contrast to 2014, when millennials accounted for only one-third of subsale purchases and much less than the 44% that Generation X (Gen X) took that year.
For rentals, millennials have accounted for less than the 59% recorded in 2019 at 55% currently, substantially more than either baby boomers or Gen X-ers at 12% and 32% respectively.
IQI said millennial home buyers prioritise convenience, price, amenities and home size, equating to homes that are conveniently located near schools, shopping, transit, retail, entertainment and services, as well as employment.
While millennials have only recently joined the job market, they do not have the highest earning potential and generally have less to spend on real estate.
This group tends to look at prices ranging from between RM400,000 and RM800,000, while square footage wise, they will often consider ranges from 800 sq ft to 1,000 sq ft.
While researchers have differing opinions on the birth years of millennials, the years 1981 to 1996 are often accepted as a defining range for the generation also known as Gen Y.