Gen Y buyers don't want a long commute to work. (Photo: iStockphoto)
From where Raffi Arslanian sits, Generation Y is the perfect home buyer. The architect and developer has 20 years experience designing and building commercial and residential properties, but turned his focus to Generation Y in the past five years. He tailors his units in northern New Jersey to these buyers—who Cyberhomes finds are increasingly picky and still want all the finer things in life. And despite the downturn in the economy, he says his units are still selling out.
Why? Arslanian points to a happy marriage of small scale, public transportation, design aesthetic and financing.
According to him, these are the top four things Gen Y is looking for in their next—or first—home:
Walkability
"Ten out of 10 of my buyers want public transportation," he said. "It’s not even nine out of 10. They want that public transportation, and if they don’t, it’s only because they’re in sales and have to have a car and are driving around all day. They want to get up in morning, walk no more than a few blocks to the station and they do not want to spend 45 minutes on public transportation. If it takes no more than 30 minutes door-to-door we’re good. More than that, and there’s more hesitation."
Priced right
"Dollar price and financing are absolutely key," he said. "After $3,000 a month, they fall off the planet. That's the market now: The guys who can buy now are very capable, very educated, very traveled—they're just young. They just don't make $300,000 a year."
And they're also unwilling to take whatever's offered, he said. They negotiate and negotiate hard to keep their home an asset instead of feeling trapped by it.
"They don’t want their home to be shackles on their feet," he added. "I come across this day in and day out. They say, 'Raffi, I’m not working for my home. I don’t want to be a slave to my home. What can we do?' They have these horizons, where the buyer is thinking, 'What will the economic picture look like five years from now?' So I have to paint a picture of what it will look like in five years. They’re staying in their homes longer than they used to. Or they’re planning on keeping the place as a rental."
Zero down
Despite tightening lending standards, Gen Y still is all about the no-money-down loan, he said. So to accommodate that, Arslanian makes sure his buildings are a few things:
Small
No more than 30 units, and you don’t have to include extras like a pool and a gym that increase maintenance fees. "On a 1,200-square-foot apartment, that maintenance bill needs to be under $350 a month or buyers walk."
FHA approved
His units are Federal Housing Authority approved, which means buyers may qualify for a loan with just 3.5 percent down. "When you have a building that’s FHA approved and is priced as we are, you get a lot of newly married couples or younger single people. These people are making the money but they don’t have the capital for a down payment."
Full of concessions
"If I can find a way to come up with the 3.5 percent, then I've got buyers," he said. Arslanian does that by providing concessions in pricing and finishes.
High style on a budget
"What they want is something that looks high style without necessarily being top of the line," he said. "They don’t need that. They’re looking for a hotel-style look while not being too cold or slick."
So how does he achieve this? He chooses finishes carefully:
Lose the clichés
His units don’t boast the glass backsplashes or the bathroom sinks that look like fishbowls—he says his customers are over that. Instead, they want a modern look and to feel like "they could greet friends in with a martini in their hands."
Go high-tech
To do this, he installs a media system that he says appeals to Gen Y’s need for technology and their sensibilities. "That has value in their eyes. It includes a flat-screen TV, an iPod doc, shelving," as well as surround sound already wired. Next, he’ll be adding a small niche for the laptop and mail. "They don’t want to use their second bedroom as an office and they don’t want to work on their computer on their lap."
Give light, not views
"If they can afford a magnificent view, they aren’t buying from me," he said. "So we build monster windows in the apartment and cover them with custom shades [included in the price of the home]. So when my customers walk in, they are not looking at the neighbor. But they can get plenty of light and they can walk to a bus and be in midtown in a few minutes."—Heather Boerner