Understanding what millennials value in rental properties allows landlords to better target them as renters
Kniwing the value that a neighborhood’s location and amenities can offer is important when considering a rental property, but every renter or homebuyer is unique. Understanding where the millennial generation prefers to live is important when trying to attract millennials to your home flip or rental property investment.
The majority of U.S. households headed by millennials are renters, according to the National Association of Realtors (NAR) annual generational trends report where millennials account for 37% of all home buyers. The NAR report, for the first time, split the millennial generation into two categories: ages 21-28 and 29-38. The St. Louis Federal Reserve shows that 77% of households under the age of 25 are still renters, while 67.1% of households between 25-29 and 50.7% of households 30-34 are renting. The oldest group, 35-39 years of age, saw 41.1% of households renting.
If you want to attract this valuable demographic to your rental property, Patch of Land has the following recommendations to help draw in millennials in your market:
Keep affordability in mind
With a median household income of $71,200, POL notices that millennials are purchasing the least expensive and smallest homes available—approximately $77,000 and about 1,600 square feet.
“Finding affordable inventory is a challenge,” said POL. “Older millennials are in their prime income-earning years and have more buying power.” The older segment of millennials has a median household income of $101,200 and are purchasing homes at a median price of $274,000.
Know that student loan debt complicates buying and renting
According to NAR, 47% of younger millennials are seeing student loan debt at an average of $21,000 with older millennials at an average of $30,000. This means that the high prices of many homes across the country are still out of reach for this demographic. Graduates are also finding it harder to save money for home purchases because of the burdens of the debt payments.
Consider the value of location
Because of the high home prices in many prominent urban settings, millennials are having to consider other options. Smaller and more affordable cities such as Oklahoma City, Grand Rapids, Michigan, Madison, Wisconsin, and Durham, North Carolina, are attractive to many in the millennial demographic. The value of proximity to work and amenities is also a strong influence in home purchasing decisions.
Smart home technology is popular
Smart locks, smart thermostats, smart lighting, smart security systems - millennials want them. Convenience and integration with smart tech are part of the attractive amenities package that may have renters or homebuyers more apt to pay more for their living situations.
Updated amenities and designs will always be in demand
While each homebuyer has unique and individual design tastes, understanding current trends in colors, flooring, and decor can help attract buyers and renters. Just be sure to consider the best financial option for your property while staying in budget. There are several techniques to lower your updates without breaking the bank.
