How Millennials & Gen Z Are Changing Real Estate Investing

The real estate market is experiencing a seismic change, driven by the preferences and concerns of Millennials and Gen Z. These younger generations are not only joining the market—they're reshaping it. From their use of technology to their interest in sustainability and alternative investments, their strategy for real estate investment is vastly different from past generations.

As a broker, knowledge of these developments is paramount to staying current and advising your clients appropriately. Whether you deal with residential mortgage brokers, commercial mortgage brokers, or private lenders, this blog will guide you through the changing landscape and enable you to position yourself as a counselor. Let's see how the new generation is transforming real estate investing and what that means for your business.

1. Embracing Technology: The Digital-First Approach

One of the most significant ways Millennials and Gen Z are transforming real estate investing is by favoring technology. Those days of the sole use of old-fashioned methods such as open houses and paper listings are gone. The investors of today are reaching out to digital platforms for everything from property searches to investment analysis.

82% of Millennials and Gen Z investors use online tools to research real estate investments before making a decision. (Source: National Association of Realtors, 2024)

Key Trends to Watch:

• Online Marketplaces: Platforms like Zillow, Redfin, and Realtor.com provide transparent access to property listings, historical data, and market trends.
• AI and Machine Learning: Advanced algorithms are streamlining processes like property valuation and risk assessment, helping investors make data-driven decisions.
• Virtual Tours: With the rise of virtual reality (VR) and 3D tours, investors can explore properties from the comfort of their homes.

How Brokers Can Help:

• Stay up-to-date on the latest tech tools and platforms to better serve tech-savvy clients.
• Use data-driven insights to identify investment opportunities and predict market trends.
• Offer virtual tours and digital marketing strategies to attract younger investors.

By embracing technology, you can meet the expectations of the new generation and provide a seamless, modern experience.

2. The Power of Social Media

Social media isn’t just for sharing photos and staying connected—it’s a powerful tool for real estate investing. Platforms like Instagram, Facebook, and LinkedIn are becoming essential for networking, marketing properties, and showcasing investment opportunities.

77% of Millennials and Gen Z investors follow real estate professionals on social media for market insights. (Source: Zillow, 2024)

Why Social Media Matters:

• Networking: Social media allows investors to connect with industry professionals, share insights, and build relationships.
• Marketing: Real estate agents and investors can use social media to promote properties, share listings, and engage with potential buyers or renters.
• Market Insights: Social media provides valuable insights into market trends and consumer preferences.

How Brokers Can Help:

• Leverage social media to market properties and attract younger investors.
• Share valuable content, such as market trends, investment tips, and success stories.
• Use social media to build your personal brand and establish yourself as a trusted advisor.

By tapping into the power of social media, you can expand your reach and connect with the next generation of real estate investors.

3. Prioritizing Sustainability

Sustainability is no longer a niche concern—it’s a top priority for Millennials and Gen Z. These generations are 63% more likely to invest in energy-efficient properties than their predecessors. (Source: U.S. Green Building Council, 2024)

Properties with green attributes—such as solar power, energy-efficient heating and air conditioning systems, and LEED certifications—are fetching premium prices and enjoying greater demand.

Key Trends to Watch:

• Energy-Efficient Homes: Properties with solar panels, energy-efficient appliances, and smart home technology are in high demand.
• Green Building Certifications: Certifications like LEED (Leadership in Energy and Environmental Design) are becoming a selling point for eco-conscious buyers.
• Sustainable Communities: Developments that prioritize green spaces, walkability, and public transportation are attracting younger investors.

How Brokers Can Help:

• Highlight sustainable features when marketing properties to younger buyers.
• Educate clients on the benefits of energy-efficient upgrades and green certifications.
• Stay informed about local incentives and programs that promote sustainable living.

By prioritizing sustainability, you can appeal to the values of the new generation and help your clients make smarter investments.

4. The Rise of Alternative Investments

Millennials and Gen Z are diversifying their portfolios by venturing into alternative real estate investments. From co-living communities and co-working spaces to storage centers and data centers, these unconventional assets provide unorthodox income streams and higher returns.

Why Alternative Investments Are Growing:

• Diversification: Alternative investments provide a way to spread risk and maximize returns.
• Democratization: Crowdfunding platforms allow individuals to invest in projects that were once reserved for institutional investors.
• Innovation: New types of real estate assets, such as self-storage facilities and data centers, are emerging as lucrative opportunities.

How Brokers Can Help:

• Educate clients about the benefits of alternative investments and how to get started.
• Stay informed about emerging trends and opportunities in the alternative investment space.
• Connect clients with crowdfunding platforms and other resources to explore alternative investments.

By embracing alternative investments, you can help your clients diversify their portfolios and tap into new opportunities.

5. The Impact of the Sharing Economy

The sharing economy is transforming the real estate industry, fueled by sites such as Airbnb and WeWork. Flexible office space and short-term rentals are becoming all the rage, capturing the shifting tastes of Millennials and Gen Z.

Key Trends to Watch:

• Short-Term Rentals: Platforms like Airbnb and Vrbo are making it easier for investors to capitalize on the growing demand for short-term rentals.
• Flexible Workspaces: Co-working spaces and shared offices are appealing to freelancers, startups, and remote workers.
• Experiential Living: Younger generations are drawn to unique, experience-driven living spaces, such as micro-apartments and co-living communities.

How Brokers Can Help:

• Explore opportunities in the short-term rental market and share insights with clients.
• Stay informed about local regulations and zoning laws that impact short-term rentals.
• Highlight the benefits of flexible workspaces and experiential living when marketing properties.

By understanding the impact of the sharing economy, you can help your clients capitalize on these emerging trends.

The real estate business is changing, and the new generation of investors is driving it. By being aware of their tech, green, alternative investments, and sharing economy preferences, you can establish yourself as an advisor who can be relied on and enable your clients to prosper in this new world.

Why Partner with RCN Capital?

At RCN Capital, we know the special needs of real estate investors—and the brokers that serve them. Here's why brokers prefer to work with us:

• Flexible Programs: From fix-and-flip financing to long-term rental funding, we provide solutions to suit your client's requirements.
• Fast Closings: We can close loans in as few as 10 business days, helping your clients move quickly on opportunities.
• Broker-Friendly: We value our relationships with brokers and offer competitive commissions, fast approvals, and dedicated support.

Whether your clients are investing in traditional properties or exploring alternative opportunities, RCN Capital has the financing solutions they need to succeed.

Ready to take your brokerage to the next level? Connect with us today to discuss our real estate financing solutions and how we can help you grow your business.