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Sunday 23 September 2018
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Millennials And HGTV Are Transforming Rochester Real Estate

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The influx of millennial buyers in the real estate market is having an effect on the real estate market of Rochester, NY. According to the Democrat and Chronicle, the demographic of millennial homebuyers and the impact of home improvement channel HGTV are transforming the real estate markets of Upstate and Western New York.

“The demographics of millennial buyers will boost housing over the next few years,” said MandT Bank chief economist Gary Keith.

With the oldest millennials in their mid-30s, the real estate market is beginning to feel the waves of new and excited buyers. Millennials and baby boomers alike have been flocking to apartment rentals because, unlike houses, renting doesn’t come with as much uncertainty. However, now that rent is on the rise, older millennials are choosing to invest in the real estate market.

For some in the industry, the influx of millennials is a good thing. However, New York State Association of Realtors president Christine DelVecchio says the home improvement channel HGTV has ruined real estate.

Because HGTV’s television shows depict beautiful, move-in-ready homes, millennial buyers all want turnkey houses. “They don’t want to pick up a paintbrush,” said DelVecchio.

However, the desire for move-in ready homes may not be pinpointed to HGTV. In fact, the majority of HGTV’s shows are focused on renovating.

These HGTV shows include Fixer Upper, Property Brothers, Flip Or Flop, Love It Or List It, Good Bones, Home Town, and Rehab Addict. The only popular shows on the channel depicting turnkey beautiful houses are House Hunters and Property Virgins.

Americans have always been pulled between turnkey homes and fixer-uppers. The sudden boost in real estate popularity may very well be the reason for the rise in turnkey home demand. However, another reason for the demand for turnkey homes could also be linked to the latest tax law.

Homeowners often borrowed against their homes in order to renovate in the past. In fact, approximately 64% of homeowners upgrading their outdoor spaces planned to renovate their backyard.

But the latest tax law now limits interest deductions on mortgage loans for homeowners. As a result, renovations now seem a little less doable for potential homebuyers.

These factors paired with sellers choosing not to put their homes on the market is causing a low inventory in the Greater Rochester area. According to the Democrat and Chronicle, there was a 2.9% drop in the sale of single-family homes in 2017.

Yet the low inventory is helping to raise sale prices, which went up 4% in 2017. Compared to the average price of a timeshare at $20,040, the average sales price for a Rochester home in 2017 was $250,000.

Howard Hanna’s Pittsford office manager Bob Maves said the Rochester real estate market is strong, but price sensitive, and there are multiple factors to consider regarding homeowners’ refusal to sell. For instance, he said, homeowners may not have equity and baby boomers may not be able to find the right house in order to downsize.

New York’s high property taxes and unemployment rate are other key problems. The uncertainty of Rochester’s larger companies, Gary Keith said, could upset the 2018 market.