Millennials love Home Depot, survey says

As millennials mature and increase their earning and spending power, Wall Street is starting to pay more attention to this generation's consumer behavior. A new Bank of America survey about home ownership reveals some surprising millennial trends and suggests Home Depot Inc (NYSE: HD) could benefit big from them.

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Secrets Home Depot employees want you to know
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Secrets Home Depot employees want you to know

You can return dead plants

If plants tend to die as soon as they come into your care, you might consider buying them exclusively from the Home Depot. Why? Because the retailer promises to take the plants back if they die within a year. (The official policy: “The Home Depot unconditionally guarantees all tropical, house, and landscape plants (only perennials, trees, and shrubs) for one year. A perennial is a plant that is expected to live for more than two years.”) If you return the plant within 90 days, you'll get a refund. After that, you can exchange the plant for a new one or receive store credit. Just make sure to keep your original receipt. Heading to Costco next? These are the 15 Costco secrets employees won't tell you.

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You can rent tools instead of buying them

When it comes to expensive tools, why buy when you can rent? Home Depot offers rentals on everything from drain cleaners and floor finishers to tractors and chip shredders. You'll pay a fraction of the price, and won't need to clear out space in your garage for the new gadget when you're done.

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There are free DIY workshops

You might've heard that nothing in life comes free, but that's not true at the Home Depot. The retailer offers free classes for kids and adults. Kids' classes include making crafts like window birdhouses and periscopes, while adult courses range from "Installing a Vanity" to "Making a Bookshelf Planter." Keep in mind that you'll have to purchase your own supplies. Besides that, it's a perfectly free way to learn a new skill and possibly even make a new friend. These are the easy weekend projects that increase the value of your home.

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Find super-cheap scrap wood

If you need wood for a project and don't care if it's not in perfect condition, check the Home Depot's cull lumber rack first. The wood there is often up to 70 percent off. Most of these scraps are pieces of wood that are slightly damaged or leftover from a previous customer.

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Check online for discounts

In addition to checking homedepot.com for special offers, you'll want to scope out websites like Groupon and RetailMeNot. You might be able to find discount codes or coupons. If you're a member of the military, you're entitled to a 10 percent discount year-round. Don't miss these 33 secrets to getting a great deal on absolutely anything.

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Know when to go

If you've got a big purchase coming up, it might be worth it to wait for a big sale weekend to come around. The Home Depot regularly slashes prices on holidays such as President's Day, Black Friday, and Labor Day.

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Beat a competitors price and get a 110% match

Yep, you read that right. If you find a lower price on an identical item at a local competitor's store, the Home Depot will match the price, plus take off 10 percent. A little effort could go a long way. Don't miss these 11 secrets to saving money at Target.

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Scoop up the 'mistake paint'

In each Home Depot paint department, you'll find an "oops" rack. The paints on these racks are heavily discounted, but not because there's anything wrong with them. Often, they were simply ordered in the wrong color, or another customer decided to leave a bucket behind. Either way, if you're working on a small project and aren't attached to a color, it's worth checking out these paints first. 

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Sign up for texts

If you're a frequent Home Depot shopper, it's worth it to sign up for their text messages just to be in the know about special promotions and offers. But even if you're making a one-time stop, you'll want to add your name to the list. The retailer offers $5 off a $50 purchase just for signing up.

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Look for the yellow tags

At the Home Depot, a yellow tag means an item is on sale. On top of that, if the price ends in $.03, it means the item is at the lowest price it will reach before it's cleared out. These are our 56 favorite ways to save money—starting now.

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Analyst Elizabeth Suzuki says investors may have some preconceptions about millennials and homeownership that might not actually be true. Suzuki says the Bank of America survey of 1,000 millennials busts several widely held myths about these young professionals and home ownership.

[See: 8 ETFs to Play a Robust Real Estate Market.]

Contrary to popular belief, the survey found that only 13 percent of millennials currently live with their parents. The survey also contradicts the belief that millennials prefer to live in an urban environment. Just 29 percent of millennials ages 31 to 35 live in an urban area, and only 39 percent of younger millennials ages 26 to 30 live in an urban setting.

The survey revealed no major financial barrier is keeping millennials from owning a home. The home ownership rate for millennials surveyed was 40 percent, up 6 percent from a year ago. Another 18 percent of those surveyed said they are "extremely likely" to buy a home within the next two years.

Millennials also are not shying away from older homes. Nearly half of those surveyed said they plan to buy and renovate an older home to save money.

Most important for Home Depot investors, the Bank of America survey revealed that millennials still prefer to do their home improvement shopping at brick-and-mortar stores such as Home Depot.

"The millennials we surveyed still overwhelmingly purchase most or all of their home improvement products in-store, although online transactions are gaining some traction," Suzuki says.

When millennials were asked which was their first choice for home improvement shopping, Home Depot (64 percent) took the top spot, followed by Lowe's Co. (LOW, 53 percent), Amazon.com (AMZN, 46 percent) and Walmart (WMT, 36 percent).

[See: 8 Ways to Cash In on a Hot Housing Market.]

"Across nearly all demographics, respondents preferred HD to LOW, with the exception of rural customers, which is not surprising given that LOW's stores skew more rural than HD's," Suzuki says.

Suzuki is bullish on both Lowe's and Home Depot, but Bank of America rates Home Depot as the lower-risk play for long-term investors. The firm has a "buy" rating and $215 price target for HD stock.

Copyright 2017 U.S. News & World Report

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