Gen X Wants No-Debt Home Ec

American Demographics, April 1, 2004 by Matthew Grimm

Byline: Matthew Grimm

Martha Stewart's somber visage under headlines about her trial might well serve as a sign of the times. Stewart soared as an archetype of a nesting Baby Boomer, a matriarch whose gospel of restrained Yankee elegance ran so deep in the domestic zeitgeist as to personify "lifestyle marketing" itself. Like the tract homes and condo communities in which she held so much currency, however, her wand-like prescriptions for household empowerment evinces a sameness that, today, seems to be squarely at odds with new dynamics driving the business of homemaking.

As nearly 49 million members of Generation X, currently 27 to 38 years of age, funnel through their own great nesting stage, arbiters of aesthetics face a period of post-Boomer adjustment. Once, the media and Madison Avenue handed down the rules of style, and Boomers represented the last generation that tried to follow those rules as a matter of status. Now, as a generation once characterized as slackers and cynics settles into its own homes, Xers are trading off extravagant, homogenous, marketing-synthesized notions of "aspirational" personal and domestic styles, opting instead for more financially manageable, more personally flavored style statements.

New media vehicles bear witness to the power of the Gen X domestic agenda: in print it's Budget Living; Chic Simple; LivingRoom, a Meredith test of a shelter book targeting Gen X women; and one slated to debut this spring from American Media Inc. Also, how-to TV has cross-pollinated with reality TV in a raft of series best described as "home makeover" shows. The Learning Channel's hit Trading Spaces, Home & Garden TV, even an ABC special, Extreme Makeover: Home Edition, that won a prime-time slot in December, are shows that place less emphasis on the perfect home, and more on cost-efficient ways to put personal stamps on one's environs - even if it's sometimes someone else's. These, says Wendy Liebmann, president of New York consultancy WSL Strategic Retail, are "the new shelter magazines."

The well-heeled, 78-million-strong Baby Boom generation was a tide that lifted all boats; not so Gen X. But now, as Boomers enter their "empty nest" stage, they've trailed off in active "feathering," some even trading down to smaller homes. Xers, the oldest now pushing 40, moving steadily into their own houses and toward their maximum earning years, are where the action is for the home furnishings industry.

While the percentage of homebuyers that are 25 to 34 years old parallels the generation's diminutive ranks in comparison to Boomers, shrinking to 30 percent in 2003 from 37 percent in 1995, the National Association of Realtors (NAR) puts the median age of first-time homebuyers at 31, about five years younger than in 1993 (and eight years younger than the overall median) with a household income of nearly $55,000. The NAR estimates that first-timers made up 40 percent of 2003 sales, largely accounting for the 11.5 percent growth in new single-family home sales for the year, to a record 1.085 million, per the Commerce Department.

The Bureau of Labor Statistics' 2002 Consumer Expenditure Survey (CEX) found that 49 percent of people ages 25 to 34 owned homes. But, a February 2003 Generation X-specific report by Winnipeg, Ontario-based Palliser Furniture, and researcher Strategic Decisions of Thomasville, Ga., reveals even higher numbers among Gen X homeowners. Of the 1,005 Gen Xers polled, 68 percent said they owned their homes, 60 percent of them with children. It's these people who are replacing a hodgepodge of furnishings accumulated from their 20s, says A.J. Riedel, senior partner at Riedel Marketing Group, a Phoenix firm that specializes in the housewares market.

Indeed, 2002 CEX data shows that the older end of the generation is moving into the most active furnishing period of the consumer cycle. While it tracked the 25- to 34-year-old group as accounting for 16.5 percent of "home furnishing and equipment" purchases and 19.9 percent of furniture in particular, the 35- to 44-year-old group showed marked increases in the same categories, 26.2 percent and 28.4 percent, respectively. Apropos of Gen Xers' imprint on the market, sales of infant furniture showed its biggest one-year jump in 2001, up 59 percent, according to research by Pam Danziger of Unity Marketing of Stevens, Pa.

Still, the risk aversion marketers always ascribe to Gen X's consumer behavior still applies. As Xers take the lead in household formation, they do so with reticence to take on credit-card debt. A 2001 Furniture Today report found that people age 25 to 34 planned to spend no more than the national median, $300, on furniture, and only households with income of $75,000 and above planned to pay more. A recent online poll by Budget Living reveals that 77 percent of respondents (74 percent of them aged 25 to 44) did a redecorating or remodeling project in recent months, but, even with an average household income of around $60,000, these people won't go beyond their means, says the magazine's president Eric Rayman.