Selling Homes to Generation Y

Here’s a real dilemma for real estate companies today: Can their agent successfully build relationships with the next generation of real estate buyers? Right now, honest brokers would have to answer a “qualified maybe at best” if we were to take a look at what they’re doing to prepare their agents for the 45 million Generation Y buyers starting to enter the housing curve.

Let’s start with some data: Generation Y is in their 20s. Graduating college, these kids are the new first-time home buyer. No, it’s not Gen X anymore; there are a few X’ers who still won’t get out of the house, but the bulk of newbie buyers are Y’ers. What do we know about them? First, they are highly networked. They have grown up online, playing online games with friends thousands of miles away, online. Their social circles are highly structured – they went on “play dates” that mom setup with their friend’s mom – and they only make new friends by “adding” them to their official page of friends online, at MySpace. They have had a cell phone since they were 10 and they don’t make calls on it. They fully expect IM to replace email and think voice mail is what Edison used to tell Watson to “come here.” They get a constant flow of information by text message – updates from friends, weather, movie times and sports scores – and they don’t “check” the internet because they are always connected to it. Speaking of the dial-up days of the internet is like remembering the Pony Express.

It gets harder, because it’s not just about the technology barriers between Baby Boomer REALTORS and Gen Y buyers: it’s a cultural thing. Boomer REALTORS are like barracuda: the good ones, at least, typify a kind of Type-A, in-your-face loudmouth that marks most of the Boomers. Remember, the low-end of Boomers curve are only 50s today. They watched the first reality television 20 years ago – The Real World – which pioneered two decades of “in-your-face” social behavior that culminated in their Ultimate President – the one who redefined the meaning of the word “is” and perfected the art of character assassination. So Boomers speak their minds and are always right: Which is why they simply hang up on any buyers who won’t tell them their name and instantly agree to lifetime loyalty the first time the agent takes them to see a property.

Generation Y is the complete opposite. They are the most docile, “can’t we all get along” play-nicers in a hundred years. They don’t like to get controversial, because they went to schools where their (Boomer) teachers told them everything was the same, just as good as anything else, and we don’t want to hurt anyone’s feelings. So something as simple (to Boomers) as haggling over the price of a car completely intimidates Gen Y. While Boomers idolized a James Dean punch in the mouth, Gen Y’ers tried to “understand the feelings” of the playground bully and bring him into the group. Clearly, the kill-or-be-killed sales tactics most of today’s REALTORS practice aren’t going to work with Generation Y.

Coming from a super-structured, ultra-safe, uber-nice childhood, Generation Y further complicates the home purchase process because they don’t do it “on their own” the same way Boomers and Gen X’ers did. Gen Y is a co-dependent purchaser with the most unlikely of creatures: a Baby Boomer. Gen Y co-purchases everything with either a parent or a trusted friend from the 45-plus age bracket. They hang out and entertain with their parent’s friends. And while they fully expect Boomers to pay for their major purchases, they also don’t make a decision without them. So the Open House is about to get a whole lot stranger: Boomer agents shouldn’t make the mistake that another Boomer Buyer has arrived dragging their kids long with them when it’s actually the other way around. And while today’s REALTOR may have had experience navigating the “co-purchase” between married couples in the past, the power-desire dynamics of child-parent is going to be an entirely new sales frontier.

Are there solutions? You bet. First, get the right tools – Blackberry, IM account, social networking account – and get beyond grudgingly using them. Second, learn a critical lesson about sales: great salespeople possess high emotional intelligence. If you have ever attended an Integrity Selling course, you know that this means that great sales people change their approach to match the style of their customer. The days of “my way or the highway” sales are over. If you don’t give Gen Y complete access to listing inventory, they’ll find someone like Zillow to do it for you. If you expect Gen Y buyers to call you back, they’ll find a Gen X’er agent who at least can chat with them on AIM. If you think AIM is still toothpaste, then just pack it in.

But most of all, what Generation Y will teach us – and already is – about real estate sales is that the ultimate transformation is about to happen. Twenty five years ago, it was a broker-centric business: everything revolved around the broker. Then we had the agent-centric ‘80s and ’90 where it was all about you, baby, right into the new millennium where the consumer-be-damned because we could make sales without even trying. What did relationships matter when there was a line of buyers bidding for homes? Why call anyone back when they were calling you? Who needed the internet when you barely put a sign up and had an offer? Buy a Blackberry – only if you needed an extra tax write off from all those easy sales!

Pop. What Generation Y real estate buyers are about to teach us – finally and for good – is that real estate must learn that in sales, it’s all about the consumer. REALTORS are about to get a two-decade lesson on that fact – and for many, the hard way.

TTYL