There’s been a drastic shift in the housing market as more and more of the general population elect to move into apartment buildings. Multifamily property investment firms like Ashcroft Capital have noticed a spike in this trend with the recent increase in investors looking to fund apartments, condominiums and building communities. The 2008 housing crisis has made a significant impact on real estate purchasing behavior, causing all age groups, particularly millennials, to give up on the traditional home model. Now multifamily developers are moving with the trend, creating new and attractive solutions, designs, and architecture to meet these shifting demands. This “rethinking” has the apartment industry predicting no signs of slowing down anytime soon.
For millennials (who represent the largest consumer group), owning a home may not be their first priority as lifestyle choices have deviated from the more traditional passage: stay home, save money, get married and move into a home. A report from Business Insider quotes US economist Michelle Meyer who says, “We believe the delay in homeownership is due to tighter credit standard and lifestyle changes, including delayed marriage and children.” In addition to this, witnessing the market crash in their earlier years may have made millennials skeptical of investing in a hard asset that may not retain its value.
6 reasons why more millennials aren’t buying homes
Millennial homeownership in the US is at a record low. The age range of millennials – Bank of America Merrill Lynch economists used 25 to 34 – is usually prime time for purchasing a first family home. That demographic factor is one reason why some housing economists are bullish on demand.
Apartment consumers are not limited to millennials. Baby Boomers and Gen X’ers are both opting to rent as well. One of the primary reasons for this is not having enough savings for retirement. According to an article published in Bankrate.com, over 66 million Americans do not have sufficient funds saved for retirement. Many of these individuals are opting to sell their homes for a quick return, to later rent cheaper properties. These groups are also drawn to the idea of renting for the simple reason that the maintenance is easier.
With rental properties in demand for these reasons and more, businesses and surrounding industries are developing new services to cater to these consumer groups. Already this has had a significant impact on new construction, housing options and marketing efforts. More buildings are being built, short term rental platforms like Airbnb are proliferating, and now, the multifamily industry is tackling smartphone devices as consumers search for listings through their phones. Ashcroft Capital affirms it’s been a busy year for the firm with the apartment industry thriving. Founder Frank Roessler and his team are predicting more prosperous years to come.