According to the results of an Urban Land Institute (ULI) survey, more and more members of the 80-million strong Generation Y (ages 18 to 34) prefer to live in urban areas. As Reuters notes, “This migration already is changing the nation, growing the cores of cities large and small and leaving small towns and remoter areas to their parents and grandparents.”
A full 40% of Gen Y is Latino or African-American, and 54% rent. They also have an unemployment rate of over 10%, yet their student loan debt load is staggering. In short, “the group is more urban and poorer,” according to ULI.
How are property owners and managers coping with these demographic trends?
Due to the high prices of rents in many of these desirable urban areas, many members of Gen Y are being forced to live with roommates or locate in less desirable areas of cities. The micro living trend, where apartments are often less than 200 square feet, also offers them an alternative by allowing them to live in desirable urban areas, but with more affordable rents. Projects in cities like San Francisco and New York are in various stages of development.
There’s also Elevé, a new 208-unit building in Glendale, California that specifically caters to Gen Y. As the developer told The Herald, Gen Y “want[s] all the amenities of a luxury apartment building, without the luxury price tag and don’t mind a smaller space. In fact, Elevé offers them all of this in a walkable, socially hip area; there is no question that this type of housing will become the norm in major California urban areas in the future.”
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The takeaway for property managers is that urban property will continue to be a hot commodity. It’s also true, at least from some experiments like the one in Glendale, that members of Gen Y place a higher premium on price, social opportunities, and neighborhood amenities than they do on the size (or maybe even the amenities) of the rental unit.
From all accounts, this urban migration will continue, and savvy property managers will read up on the trends and focus on selling their neighborhood and building as much, if not more, than the particular apartment itself.
If you’re a property manager, how do you market to Generation Y? How are you adjusting your sales approach, and what have the results been?Read more on Property Management Trends