When it comes to the next wave of homebuyers, who are they, how do they shop and how do they think? It might be a surprise to you, but Generation Z is emerging as a homebuying force sooner rather than later. Gen Z, the individuals born between 1997 and 2012, is the top demographic in the next wave of homebuyers
A large portion of Gen Z plans to enter the real estate market within the next year. A 2021 survey by Rocket Homes indicated that 45% of these young adults wanted to purchase a home within the next five years. Millennials are considered the generation of renters, but Gen Z wants to shake things up by owning their own homes.
This generation is thought to be extremely openminded, but its members also value critical thinking and tend to evaluate their options carefully. As digital natives with multiple streams of information at their fingertips, they are on track to be the most educated generation yet.
Members of Gen Z know they want to own their homes rather than rent, but many of them have no idea where to begin with this major step in their lives. Mortgage originators who are looking to expand their business should consider catering to this new and large population that’s entering the real estate market.
Mortgage originators can certainly benefit from training in the social media platforms frequented by Gen Z. A recent survey by Forrester found that 63% of Gen Z use TikTok on a weekly basis, compared to 57% for Instagram and 54% for Snapchat. TikTok is a popular app because of the variety of content hosted on the video-sharing platform. TikTok is not only a place for mindless scrolling, however, as it also features hundreds of thousands of educational videos across every subject imaginable.
Many originators use TikTok to market their services by acting as homeownership teachers. A quick search of mortgage brokers on TikTok will show hundreds of videos detailing how to become a broker, a day in the life of a broker, com-mon mistakes that brokers see and more. But the market is not yet saturated and there is till plenty of room for originators to use their creativity to reach this emerging market.
The key to gaining traction on TikTok is understanding the algorithm it uses. The algorithm measures the amount of time viewers stay on particular videos and promotes the videos it considers to be of high value. Videos featuring viral songs or audio clips, engaging videography and straight-to-the-point messages appeal to the algorithm and end up with the most views.
Gen Z has grown up with stimulating video content, which is why Instagram and YouTube are close behind TikTok in popularity. Instagram stories have always been popular with brands looking to engage with their audiences. The customizable options available for Instagram content allow mortgage originators to get creative when it comes to sharing wisdom, increasing engagement and promoting services.
YouTube’s popular Shorts feature allows users to post short clips that are similar to TikTok’s. Gen Z reacts positively to fun, engaging content that also provides meaningful information. Mortgage originators can use the social media algorithms to their advantage when utilizing these Gen Z online hotspots.
Due to the multiple streams of information at their disposal, Gen Zers only pay attention to the creators and brands that share relevant, trustworthy content. Therefore, businesses catering to Gen Z need to take the time to build trust with their audiences.
Transparency is crucial when it comes to posting on social media. Clickbait content, or content that misleads or confuses viewers in an attempt to get high numbers of clicks or views, is everywhere. Members of Gen Z aim to avoid such content.
The practice of creating clickbait headlines is fiercely debated in marketing circles. Facebook, Google and other tech companies have been taking a stand against clickbait content. So, content creators will want to understand this when formulating a marketing strategy.
Mortgage originators who share clear, truthful content about low interest rates or high loan amounts, for example, will be rewarded by social media algorithms with higher engagement from users. Gen Z places a high value on authenticity, so quality content that provides relevant, accurate information in a straightforward manner will undoubtedly see more success with this audience than clickbait content that cannot deliver on its promises.
Gen Z likes to plan for the future and think through every aspect of every decision, especially when it comes to homeownership. After watching older generations struggle financially, Gen Zers have started to rethink what their money can do and prepare for every possible outcome.
For this reason, they want the finance professionals they work with to be realistic and not take advantage of them during the overwhelming homebuying process. The craziness of the current housing market further necessitates realistic expectations and transparency in homebuying. Originators need to inform members of Gen Z with the honest truths about homebuying and finances if they want to capture the market.
In addition, mortgage originators must provide a level of relatability if they want to attract the attention of the Gen Z market. Learning and implementing Gen Z lingo can help originators appear more relatable throughout their content. But this is easier said than done.
Content creators from older generations can appear to be inauthentic or trying too hard when implementing Gen Z slang, which then causes younger viewers to cringe and click away from the content. On the other hand, using trendy words and phrases correctly can pay off in a huge way to appeal to the Gen Z masses. When in doubt, anyone looking to create relatable content can reach out to their younger colleagues to find out what appeals to them.
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Gen Z will soon become the leading force in the housing market, so learning to market to them is something that all mortgage originators will need to do. Understanding what differentiates Gen Z from its predecessors, as well as figuring out how to utilize its favorite social media platforms, will allow originators to stand out from the crowd and attract business from this eager and emerging market. ●