Zillow unit mines its data to find which features motivate millennials most.
Homebuyers – especially first-time buyers shopping for entry-level homes – can expect to pay a significant premium for houses with listings that tout popular farmhouse or craftsman-inspired features, according to a new report from RealEstate.com, a Zillow Group® brand tailored to helping first-time buyers find and budget for their first home.
RealEstate.com® analyzed listing descriptions from millions of entry-level homes – defined as those priced within the bottom third of the market – to see how certain home features, amenities and design styles affected sale price.
Starter homes mentioning "coffered ceilings," "claw foot tubs" or "farmhouse sinks" in their listing descriptions saw some of the highest sale premiums of the keywords analyzed – selling for as much as 29% above expected values. Homes described as "craftsman" performed better than any other design style analyzed.
Energy efficient features also command high premiums among entry-level homes. Homes mentioning "solar panels" sell for as much as 40% more than expected, but mentions for higher-tier homes only saw a 13% boost.
Millennials are playing an increasingly larger role in the housing market. They make up 42% of all home buyers today and 71% of first-time buyers, and their preferences – from location to home features – may have an increasingly notable impact on the market.
"In today's competitive housing market, understanding what homes may command a premium or attract multiple offers can be hugely beneficial to buyers," says Jeremy Wacksman, Zillow Group chief marketing officer. "However, it's important to keep in mind which features or amenities matter most to you in a home. While a farmhouse sink or butcher block counters may appeal to many millennials and first-time buyers, not everyone may want to pay the premium those features may command."