Over the past few years, Gen Z has captivated the consumer market by challenging traditional spending habits. While older generations often embraced consumption as indicative of success, this younger cohort is lending their collective ear to the call for more mindful purchasing. With the escalating cost of living and the omnipresent advertising permeated through social media, Gen Z voices are growing louder about their desire for sustainability and authenticity
Take, for example, the rising trend dubbed "underconsumption core." It shines light on the importance of living sustainably and maximizing what one already has, effectively flipping the script on the excess and opulence often displayed on platforms like Instagram and TikTok. "When every moment of your life feels like you're being sold something and the price of said item keeps going up, people will burn out on spending money," explained financial educator Kara Perez. Her sentiments resonate with many young people who have begun to question the need for excess.
Content creators like TikTok user loveofearthco have capitalized on this shift, critiquing the prevalent attitude of overconsumption. A viral video from this account proclaimed, "I spent money I didn’t have on things I didn’t need," urging viewers to reconsider their purchasing habits. Another account, nevadahuvenaars, exemplified what "normal" consumption looks like: used furniture, creativity with decor, and meal prepping instead of frequent eating out.
Despite the U.S. economy boasting record corporate profits, many Gen Z members feel the weight of financial hardship. It’s almost as if their struggles are being dismissed by the marketplace, which can feel quite gaslight-y. With inflated prices lining the grocery aisles and rent skyrocketing, the perception fueled by influencers of grandeur and abundance can clash with the reality of many young adults. A 2024 Bank of America survey revealed over half of Gen Z adults, aged 18 to 27, viewed the high cost of living as their primary barrier to financial success – many admitted they don’t earn enough to enjoy the lifestyle they desire.
Not only does this generation prefer sustainability, but they also aim to make their dollar stretch as far as possible. Social media trends like the underconsumption movement present accessible pathways for young consumers to engage with sustainability, allowing them to save money as they attempt to protect the planet. Ashley Ross, Bank of America's head of consumer client experience, emphasized this dual advantage of financial prudence and environmentalism.
It's critical to note there’s history behind such movements. After the financial crisis of 2008, many adopted frugal habits as securing stable financial ground became of utmost importance. Today, the echoes of previous recessions can be felt as Gen Z grapples with their own economic uncertainties. Andrea Cheong, another influential figure advocating for underconsumption, highlighted the addictive behavior linked to the pressures of materialism. She pointed out, "It is tied to pressure to articulate who we are through possessions. Conserving is cool, and it’s time we lean more toward quality over quantity."">
Meanwhile, as they embrace sustainability, Gen Z’s values have reached beyond their purchasing behaviors, influencing sectors such as residential real estate. Developers recognize their affinity for fitness and wellness, leading to residential spaces prioritizing health-focused amenities. Dubbed as 'Generation Active' by Les Mills, Gen Z's passion for fitness is reshaping the real estate market and driving demand for properties with integrated health and wellness facilities.
According to the Joint Center for Housing Studies at Harvard University, Gen Z leads with 7.9 million rental households. Though their homeownership rate exceeds previous generations, many are leaning toward renting for the flexibility it affords. Ever-adaptive, real estate developers are rapidly adjusting to these consumer preferences. By year-end, nearly 520,000 rental units are expected to be completed – 30% more than recorded the previous year. With amenities such as gyms, spas, and co-working spaces gaining traction, properties are swiftly transitioning from mere living spaces to wellness havens.
Examples of these wellness-focused developments include the Commodore apartments located in Arlington, Virginia, featuring expansive fitness centers alongside relaxation zones and outdoor decks. Other residential projects are placing premium equipment within fitness facilities to cater to youthful residents who prioritize their well-being. The Collective, situated in Washington, D.C., is among the properties providing modern fitness centers equipped with spin classes led by instructors.
One of the flagship developments is Gibson Point, created by Boston-based real estate developer Redgate. This upscale property flaunts its fitness center, yoga studios, and even services for massage therapy. "From our state-of-the-art cold plunge pool to serene on-site spa experiences, every amenity at Gibson Point is painstakingly curated to nurture mind, body, and soul," said Redgate's principal Damian Szary.
Developers aren't just focusing on affluent clientele, either; they're increasingly recognizing the need to implement wellness features across various price points and demographic profiles. Affordable amenities such as access to group fitness classes are rapidly becoming fixtures within mid-market and even lower-income residential spaces, acknowledging the importance of fitness to Gen Z.
Fitness franchises like Planet Fitness and Crunch Fitness continue to meet the demands of Gen Z by offering their services at competitive prices. For example, the new CEO of Planet Fitness revealed Gen Z members account for the majority of the company’s new sign-ups. Innovative marketing strategies, like the High School Summer Pass Program, invite local teens to work out for free at their gyms during summer months, fostering early engagement with this health-conscious crowd.
Through their holistic experience, encompassing both consumer behaviors and real estate preferences, Gen Z is creating ripples of change across various markets. Whether it be advocating for underconsumption and sustainable practices or demanding fitness-oriented amenities, this generation is redefining lifestyles and making impactful choices for future generations to come.
What lies next for this dynamic cohort? It will likely involve continuing to use their voices to shape markets, cultures, and economies. The blend of thrifty consumer habits and health-oriented living can be expected to leave its mark on societal values, inspiring other generations to follow suit.
