Nat Kunes
Gen-z is entering the apartment market, and the generation has high expectations for rental living. Luxury student housing has grown in popularity in recent years, and gen-Z has had the benefit of staying in quality housing during college. As it enters the apartment market, it will be looking for a similar living experience with amenities and high-end features.
“Multifamily housing runs the gamut with a balance of both older buildings and newer, luxury communities. Meanwhile, luxury accommodations are increasingly seeping into student housing communities, to the point where a large segment of U.S. students are living in units and buildings that are nicer and newer than what they might expect to afford once they leave school,” Nat Kunes, VP of product at AppFolio, tells GlobeSt.com.
As a result, gen-Z is going to have an adjustment period when they enter the apartment market, especially those moving from a college town to a major city. If a person moves to a market like L.A. upon graduation, they're going to face a different reality with the apartment market in terms of cost, accommodations and more,” says Kunes. “At the same time, many will still have higher standards when it comes to living situations than generations of new grads before them, as they've already experienced what luxury living is like.”
In many ways, gen-Z is going to view amenities that are currently considered high-end as standard. “Millennials may have, post-graduation, viewed an entertainment room, a gym and a pool table as higher-end perks in a multifamily building, those amenities don't necessarily cut it for Gen Z,” says Kunes. “This is a tech-savvy generation, so they want smart-living, like energy-efficient lighting, energy-saving toilets, smart appliances, and smart televisions/entertainment systems and their own bathrooms off of their bedrooms.
There are some similarities. Like millennials, gen-Z values experiences and social spaces in their living community, and that is a trend that has already been prevalent for years. “This generation values experiences over material things,” adds Kunes. “They like more social living environments that give residents a chance to interact with each other more often, and they appreciate perks and amenities that aren't necessarily tangible things.”
To capture this crucial demographic, apartment owners are going to need to make adjustments. Often, these changes will require a capital investment, but there are things that property owners can do now without a major investment. “Consider equipping units with an Alexa device,” says Kunes. “Apart from giving renters the capability to use voice-commands to play music, purchase items online and read them recipes, Alexa devices can also hook into some property management software to enable renters to pay rent and send maintenance requests through the device.”
In addition, Kunes recommends thinking about the small details and add features that will enhance residents' quality of life. “There is something to be said for providing a social aspect to Gen Z living,” he adds. “If there's no space available for a pool or outdoor lounge, think small, and purchase an outdoor grill instead to promote some form of community, shared living. Create social and networking events within a multifamily community to bring people together. Brand your multifamily community as social living.
The oldest of the demographic is graduating from college now and entering the workforce, meaning that they will begin to make a big splash in the rental market. “Their impact is yet to be felt strongly in the market. However, fast-forward just the next several years, and we'll see a lot more of them in the renter market,” says Kunes. “As Millennials start to age and more buy homes and start families, their apartments will be replaced with first-time, Gen Z renters, all of whom have a new set of expectations. So the change, while barely felt right now, will be a strong force over the next five to ten years. And the years move fast—so it's important to start planning for this generation now. Don't wait.”
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Kelsi Maree Borland
