There have been several large demographic trends that have positively affected the apartment industry over the last few years – a tight home lending market, more folks avoiding the anchor effect of mortgages so they can pursue job opportunities in other cities if necessary, the reluctance of young folks to commit to long term debt – but the wave of baby boomers who are downsizing might be one of the most significant trends in coming years. From an article at Property Management Insider:
In a report issued by the Federal Reserve Bank of Kansas City by economist Jordan Rappaport, “the longer term outlook is especially positive for multifamily construction, reflecting the aging of the baby boomers and an associated shift in demand from single-family to multifamily housing.”
He says that movement from single-family to multifamily housing could create a geographic shift from suburban living to city living, and that suburbs may need to consider rezoning alternatives to encourage multifamily reconstruction.
In a study last year, NMHC projected an increase in the number of older apartment renters. While most renters won’t fall into the Boomer category, those 65 and older will account for almost 60 percent of the increase in apartment renters by 2023. In the past 10 years, just more than half the increase came in the 45-54 and 55-64 age groups, the report says.
The younger demographic will continue to fuel demand for apartments, but don’t forget the Baby Boomers.
You really should read the whole article and see what else this trend might mean, particularly as it concerns amenities and apartment unit configurations.