TWO NEW BREEDS OF RENTERS, AND WHAT THEY WANT

December 15, 2013 on 7:14 pm | In Uncategorized | 6 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

6 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 #

  4. Known as a nation of renters, only around 43 percent of those living in Germany own their property, but the number is slowly increasing.

    The Institut der deutschen Wirtschaft Köln (IW) has conducted a five-year analysis of all 402 counties and cities in the country to find out where it’s worth it to buy property.

    Residential property in Germany’s cities is overvalued around 25 percent, according to an index released Thursday by the VDP Association of German Pfanbrief Banks.

    Prices are rising across the country, especially for new-built units.

    IW concluded that buying a house or apartment made financial sense in only 27 percent of the regions examined.

    Comment by Inman News® — May 16, 2014 #

  5. Despite the costs, most people want to remain in their homes as they age—73% of people 45 and older say they would like to stay in their current residence as long as possible, an AARP survey found. And 67% say they want to remain in the same community. Yet most homes aren’t equipped with basic adaptions that would allow people to remain there as they grow older, such as no-step entry ways or lever-style handles on doors and faucets for easy opening.

    Comment by CNNMoney — September 4, 2014 #

  6. States where student loan debt had the least percentage impact on income needed to buy a median priced home included California (graduates with student loans need to earn 12 percent more than graduates without student loans), New York (17 percent), Virginia (17 percent), Massachusetts (18 percent) and Wyoming (19 percent).

    Comment by RealtyTrac — September 7, 2014 #

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