Booming Urban Housing Rental: The Millennial Influence
Millennials are one of major driving factors in the US economy. Out of the total population in the country, millennials (18-34 years) constitute the major share, a staggering 75.3 million. The lifestyle and buying behavior of this generation, or Gen Y are influencing various industries, including the real estate, especially multifamily property investors. In this post, we delve deeper to understand the key driving factors of multifamily housing rental considering a constantly changing market.Many Millennials prefer renting to buying considering the financial burden of mortgage; and this is where real estate investors can score.
Three Key Driving Factors for Housing Demand Surge
The homeownership rate among young people, especially millennials across the nation, has been declining steadily in recent years. In 2005, for instance, 43 percent of adults below the age of 35 owned a home. Currently, that rate is 35 percent. There are several reasons for this downward trend, one of them is the rising cost of housing in most cities.
The key driving factors:
1. Renting is the Way
It’s worth repeating here that many millennials are choosing to rent apartments instead of homeownership. This is one of the reasons why apartment construction is going on at a steady rate. According to social analysts, millennials’ preference for renting appears to be driving what is called the “sharing economy.”
2. Properties with Modern Amenities
A study conducted by Rent.com in May of 2015 reveals some of the reasons why younger adults prefer living in an apartment. The reasons include:
- Greater flexibility compared to homeownership, when occupants need to travel or move
- The responsibility of property maintenance lies with landlord
- Greater affordability in a popular urban neighborhood
In addition, apartment complexes that are cable and Internet ready attract more millennials. Availability of Wi-Fi in the building complex along with other in-house services are also a plus.
3. Love for Aesthetics in Interiors
Many millennials grew up in newly constructed or renovated buildings with intricate and aesthetic finishes. Hardwood floors, granite countertops, and stainless steel appliances that were once considered hallmarks of luxury living have now become necessities among renters. Millennials, especially, want a living space that is on par with what they are used to, just without the costs of homeownership. This is the reason why multifamily investors are hiring interior renovation specialists for moderate or extensive interior remodeling, be it in Texas or any other state.
The Way Forward
Homeownership has been showing a downward trend for long, as millennials are more inclined to renting affordable apartments with modern amenities. This generation usually looks for efficiently designed one-bedrooms and studio apartments. A study by Forbes shows that these two types of apartments now constitute 54.4 percent of the apartment rental market that is driven by millennial demand. If you are a multifamily property investor and want to attract renters through interior property renovations, consult us today. You may also call us at (972) 432-6922, or fill out our contact form, and and one of our experts will get back to you, shortly.