When it comes to renting vs. buying, you might separate Gen Y into two categories: those who seek spontaneity and those who seek stability.
The spontaneous bunch is more likely to rent. All about the experience, these Gen Yers are the types who will take an internship in a new city and search for a roommate on Craigslist with no hesitation. They may change jobs or living situations frequently and feel it’s important to keep their options open, just in case something better comes along.
The stable crowd loves the idea of nesting and settling down. Some began working toward that goal when they landed their first job.
Of course, there are pros and cons to each path. Some say renters are essentially flushing money down the toilet. Renting can also lead to unexpected dilemmas. Roommates can abandon ship or get fired and rents can skyrocket out of the blue. Property owners may decide to sell and kick the renter out on short notice. And there are more restrictions in rentals, such as a no-pet policy.
Homebuyers purchase property with the idea that it will increase in value as time goes by, plus they can enjoy the control and freedom that accompanies homeownership. But it’s also a commitment that some Gen Yers don’t want on their hands.
CUs play an increasingly rich role in the housing market. According to Callahan & Associates, more than 3,500 credit unions originated $84.5 billion in first-mortgage loans to 510,000 members in 2010, not including loans originated by CUSOs or correspondent and referral programs. CUs can benefit further by marketing their mortgage products to Gen Y members who are in search of their first home.
Gen Y’s homebuyers may have a lot of questions, so answer them. Provide house hunting tips and a clear explanation of each step of the home buying process on your website.
Make it easy for members to check rates, apply for a mortgage and check the status of their loan online. Show them the benefits of refinancing an existing mortgage. Reassure them that if they still have questions, they can pick up the phone and ask or make an appointment to meet with a CU representative in a branch.
And don’t forget to utilize your social networking and mobile tools. A mobile platform that members can use to get started on a mortgage application or browse rates is likely to grab the attention of Gen Y. Sharing home buying tips or advertising your mortgage lending program on Facebook or Twitter is also sure to pique interest.
Gen Y might be fickle sometimes, but for many of them, the American dream is still alive. Embrace it.