I’ve read so much news lately about the growing demand for multifamily and the death of the American Dream of homeownership. Heck, I’ve even written a few of those stories.
The numbers are hard to refute: according to Harvard University’s Joint Center for Housing Studies (JCHS), demographic trends favor continued growth in the number of renter households for at least the next decade with population growth alone increasing the number of renter households by more than 3.6 million by 2020.
That number includes the Echo Boomer generation that we’re hearing so much about. Echo Boomers apparently are more comfortable in urban areas and are willing to live in smaller spaces so they can be close to all the things offered by urban cores.
Researchers tell us that Echo Boomers are more likely to be renters than other groups. Interestingly, JCHS says that nearly eight out of 10 Americans age 18 to 25 are renters already, while more than 65 percent of 25 to 30 year olds are renters too. So, it’s not just Echo Boomers who are renters – it’s just that there are so many of them, and they’re at the age right now where they are more likely to be renters.
While homeownership is seemingly less popular today, and for a variety of reasons, I might add, I wonder whether Echo Boomers are going to follow the same path as the generations before them and end up buying houses. After all, most of them did grow up in those environments.
With that in mind, the move toward homeownership is usually driven by adding children to the mix. Once people have babies, they tend to want homes – complete with spacious backyards and well-appointed playrooms.
And, as most urban housing experts will tell you, urban areas tend to lack high-quality schools. Now, I am not saying that all schools in urban areas are bad, but schools are one of the main reasons why people move out of urban areas. And, I don’t think that’s going to change, no matter how much someone likes being a renter and living in an urban area.
When it comes down to it, people are going to choose what’s best for their kids, even if it means living in the suburbs and commuting for longer distances. The alternative, of course, is to provide better educational opportunities in urban areas. And sadly, that doesn’t seem to be much of a priority.
Want to continue reading?
Become a Free ALM Digital Reader.
Once you are an ALM Digital Member, you’ll receive:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
*May exclude premium content© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
