Even during the COVID-19 outbreak, demand for renting over owning a home is continuing to grow. Apartment developers and property managers have a terrific opportunity to present quality lifestyle rental communities that cater to a growing list of consumers. The data is clear:
- Apartment properties were occupied to 94% at the end of Q1 2020 and our leasing is continuing strong even during COVID-19.
- According to an article in Senior Housing Business, more than 10,000 persons per day will turn 65 until the year 2030. These active adults are ready to downsize and have not rented in decades. Their last experience with renting may have been helping their child find an apartment for college. The apartment industry has an excellent opportunity to re-introduce this demographic to renting as a lifestyle choice.
- The homeownership rate peaked between 2004 and 2007 at nearly 70%. The homeownership rate today hovers around 65% according to the U.S. Census Bureau. There are many reasons for the reduction in the homeowneship rate including that from millennials to baby boomers consumers want a simpler and more flexible way to live.
- Consumers have discovered that owning a home is not a great investment. According to an article in Forbes from March, 1 of 2020 titled “Here is how to Decide Whether to Buy or Rent a Home,” home prices from 1915 to 2015 appreciated 0.6% according to a study by Yale economist Robert Shiller. Once the cost of maintenance is calculated, owning a home and having a mortgage in many parts of the country has become nothing more than a forced savings account.
- According to a RealPage webcast in March Pre-COVID, resident retention is the highest it’s ever been.
As I write this article I wonder why I own my home. I suspect my wife and I have spent as much to improve and maintain it as we paid for it. Americans want to own things and that will not change with real estate. We want to garden and landscape, design and paint the walls the color we want to. The apartment industry is doing a better job of offering choices to consumers at different demographics.
Metonic believes that every person regardless of their age or income should have access to great housing options. In the past 12 months we developed or acquired:
- Ravello 192, which is focused on the empty nester and executive
- Torello on Maple, which caters to the millennial seeking a cool home in the suburbs
- Onyx at Akarsben for families that need a hand up
- Latitude 41, which will provide service to military personnel who serve us and to students gaining their education
Metonic is looking forward to the second half of 2020 and being of service to consumers considering the housing that is the best fit for them and their family.
– Bob Dean, Metonic CEO