TWO NEW BREEDS OF RENTERS, AND WHAT THEY WANT

December 15, 2013 on 7:14 pm | In Uncategorized | 3 Comments

by Jodi Summers

During the Great Recession, a new breed of renter was brewing…the Echo Boomer. There are more than 65 million Echo Boomers ages 20-34 crawling out from their parent’s basement entering the real estate market. Many parents didn’t love the idea of having one or more of their adult children move back home. also helps stimulate demand for rentals that serve the echo boom market, and some of the lucky ones got their parents to subsidize their rent as a motive to leave home.

Specialists at the Urban Land Institute have concluded that these are the features most likely to appeal to echo boomers who can afford to rent or buy a new multifamily unit:

  • High-powered internet connections for all spaces in the building; fast connectivity is a must.
  • More open, flexible space within the units.
  • High-quality kitchen and bathroom countertops but less closet/storage space.
  • Shared amenities, such as communal space for informal get-togethers and parties; gym/sports equipment; bike storage; and dog parks/walks. Multifamily rentals that permit dogs ought to consider including outdoor dog washes in order to avoid clogged sinks from dog hair.

As far as the size of the space – this group doesn’t need a lot.

  • Compact, less-expensive rental or condo studio units in the 250- to 450-square-foot (23–41 sq m) range.
  • Two-bedroom, two-bathroom units that can be shared by three to four echo boom renters.
  • High-amenity one-to two-bedroom condos for higher-income echo boomers.

Savvy developers note that the needs for echo boomers and their downsizing boomer parents are not that different. The trick is to build two types of products within the same building, with the larger, 2+ bedroom / 2.5+ bathroom units located on the higher floors. The larger, boomer units should also contain more closet/storage space, more formal entertainment space, and larger bathrooms.

The needed size of space should largely separate the two age groups within the building.  Keep in mind there will always be the tech crowd, who have received large stock payouts, moving to the larger units, or that some boomers will not choose small pieds-à-terre on a lower floor.

There’s a whole new breed of renter out there. Grab hold of this market.

**

http://www.costar.com/News/Article/Renter-Demand-Holding-Fast-So-Far-As-Apartment-Supply-Wave-Begins-to-Break/151551?ref=100&iid=351&cid=383F14EEE265B182474DA2442BACBBBF

http://www.marcusmillichap.com/Services/Research/

http://urbanland.uli.org/Articles/2013/Jul/GruenMillenials

http://www.socalmultiunitrealestateblog.com/?p=2494

http://www.forbes.com/sites/peterjreilly/2011/12/21/housing-the-echo-boomers-next-big-real-estate-opportunity/

http://ui.uncc.edu/sites/default/files/imagecache/photo_large/photos/RS3783_web_collegestudents.jpg

http://cdn.freshome.com/wp-content/uploads/2012/06/Swedish-apartment-14.jpg

http://www.seniorsforliving.com/blog/wp-content/uploads/2012/04/iStock_000017029366XSmall.jpg

http://static4.businessinsider.com/image/4f90318169bedd7413000023/meet-the-echo-boom-the-80-million-people-who-will-save-the-american-economy.jpg

3 Comments »

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  1. No group has less compassion for renters or more contempt for rent control and tenant protections than landlords.

    Comment by SteveSchwab — December 15, 2013 #

  2. At the broad scale, renters tend to cluster in urban areas, where the housing stock and the cost of housing is more conducive to renting. But these patterns also vary by city. The homeownership rate in St. Louis, for instance, is about 46 percent. In New York City, it’s just shy of 33 percent.

    Comment by The Atlantic — December 20, 2013 #

  3. This recently completed mixed-use tower complex in the Netherlands, takes up only 60 square meters (a smidgeon under 650 square feet, smaller than the average racquetball court). Architect Rem Koolhaas envisioned De Rotterdam to be a “vertical city,” meaning that a whole host of functions–offices, apartments, a hotel, shops, dining, and more–must be concentrated in a small space.

    Take the video tour…
    http://www.fastcodesign.com/3027182/tour-a-luxurious-5-room-apartment-thats-just-650-square-feet

    Comment by Fast Company — March 8, 2014 #

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