The millennials are starting to move out of their parent’s basements to become homeowners, and that trend is seen as a necessary precursor to becoming prime customers for boats.
Looking back for a moment, during the post-recession period, studies were showing fully one-third of 18 to 34 year-old millennials were living at home with their parents. The reason most often cited was a staggering amount of college debt. Indeed, in an industry speech, Thom Dammrich, president of the National Marine Manufacturers Association, said: “It is not only inhibiting the housing industry, but I believe is inhibiting the sale of new boats too. If you don’t have enough money to have your own place, you certainly don’t have enough money for a boat. And, if you are living at home, you are probably not married and starting a family.”
But things appear to be changing for the better in what is now the largest population segment in our nation. While there are some differences in opinion as to the precise definition of millennials, Time magazine pegs it at 76 million born between 1980 and 2000, the last generation of the 20 century. It’s a generation that was impacted hard by a recession that caused record unemployment — tough times to join the workplace in a period of economic instability. But that has all faded in the current robust economy.
Writing in SmallBizDaily.com, Rieva Lesonsky, CEO of GrowBix Media, says millennials are now driving a surge in home buying. While much was made of home ownership on the downswing, Lesonsky turned to Barry Ritholtz, a Bloomberg View columnist and author of “Bailout Nation: How Greed and Easy Money Corrupted Wall Street and Shook the World Economy,” for his current observations.
Ritholtz noted home ownership peaked in 2004 when 69.2 percent of U.S. households owned their homes. Then it hit bottom in the second quarter of 2016, when home ownership fell to 62.9 percent, the lowest rate since 1965. But it’s on the rebound, already up to 64.2 percent today. And it’s the millennials driving the surge. Ritholtz predicted this back in 2014 when he wrote: “The economy will one day improve, and the millennials will move out of their parents’ basements. When that happens, expect to see home ownership rates move back higher.”
The Census Bureau confirms that home ownership for millennials has risen from 34.7 percent to 36 percent in one year. (FYI, 79.2 percent of homes in America are currently owned by ages 65 and up). But as millennials get older, this is going to steadily change.
Millennials are getting married later than their parents, but that’s picking up, too. There are about two million weddings every year, according to The Knot, which is often the precursor to buying a home. What millennials want is interesting, too. They want smaller, functional homes. They value originality and uniqueness, not cookie-cutter. And, in what could be a parallel in selling millennials today’s and tomorrow’s high-tech boats, 77 percent want a home with technological innovations — they want to brag to friends about smart automation, not a kitchen upgrade.
Finally, clues for reaching millennials include that fact that they are the digital generation. They have the highest average number of Facebook friends, an average of 250 friends versus. Generations X's 200. Moreover, 55 percent have posted one or more selfies to social media sites versus only 20 percent of Generation X. And, they are very mobile, so they send a median of 50 texts a day.
There’s no question the huge millennial generation represent boating’s long-term future. From now on, more and more will be reaching their prime earnings years, have acquired their homes, had their babies, and they’ll be the leading targets for our message that boating is America’s greatest family sport. It’s all good news.