Millennials don’t trust lenders or the housing market – So how do we reach them?February 13, 2020
One of the most defining characteristics of the Millennial generation’s experience with the financial and housing ecosystems is that of fear.
As a result, they have developed a pervasive mistrust of banks, lenders, and the housing market overall. In one study by Even Financial, 92% of millennials stated that banks could not be trusted, and over half said they didn’t have anyone to turn to for financial advice.
In a recent home buying event in Los Angeles, attendees consistently shared their fears and insecurities about the topic.
“It’s scary,” said Reina, a 31-year-old homebuyer. “I think in the past there hasn’t been a lot of transparency about the process, and there’s just so many steps that are really intimidating.”
There’s a generational gap in how we think about homeownership and the American Dream.
Access to homeownership for this generation isn’t just about credit. It’s about access to trustworthy advice, transparent information, and personalization.
The Generational Gap
When I speak on the topic of Millennial homebuyers to groups of loan officers and agents, the audience repeatedly echoes the same disparaging jokes about snowflakes and participation trophies.
I ask them what comes to mind when they think of Millennials, and predictably, in nearly every session, they cite “lazy” or “entitled” as an almost instinctual reaction to the question.
(To be fair, I encourage these comments so as to address the topic, and because I enjoy self-deprecating humor).
However, it seems like there’s always a new viral article about how avocado toast is “ruining Millennials,” which fuels this sentiment. In Zillow’s humorously patronizing study on real estate trends among Millennials, they cite the reason for our slow entrance to the home buying market as a result of spending money on lavish bachelor parties instead of saving.
As entertaining as that click-bait may be, this kind of commentary reflects a harmful narrative between generations, rooted in two very conflicting experiences of the housing market.
In context, this perception that Millennials are just slacking off when it comes to wealth-building is understandable. For the majority of Baby Boomers, homeownership and a traditional career path translated to safety and security. They bought houses, they climbed the corporate ladder, and now many of them sit in a relatively secure place in our society. Naturally, they are confused when their children are not following their white-picket dreams.
However, for Millennials, who entered adulthood during or immediately following the financial crisis, homeownership does not necessarily translate to security. In fact, to this generation, the entire system their parents raised them in appears to have crumbled around them, and to a certain extent, they feel betrayed.
Millennials turned the key to their adulthood and walked into…