Why the Apartment Industry Should Take Baby Boomers Seriously
As this group born after World War II and just before Davey Jones and the Monkees took America’s teens by storm aged, it established a confident and optimistic culture that shaped housing for years to come. Boomers chased a greater, affluent lifestyle and were willing to mortgage the farm to get what they wanted, unlike their parents.
The apartment living experience, accented by green and gold appliances and shag carpet in suburbia, was a means to the end goal of owning homes large enough to entertain, raise a family and enjoy the lifestyle their parents couldn’t afford or didn’t find prudent.
Now that they’ve raised their children and sent them to college, their nests are too large and down-sizing is more pragmatic. And while time should have naturally reduced their numbers – and impact – it hasn’t. Seventy-six million strong on one point, Boomers haven’t lost ground despite natural attrition as they’ve aged. An influx of Boomer immigrants has re-energized their population to nearly as large as what it was in their heyday, once again maintaining an impactful demographic.
The number of Baby Boomers leasing is growing
Dr. Rosemary Carucci Goss, Residential Property Management Advisory Board Professor and Associate Director, Program in Real Estate Virginia Tech, says property managers and owners shouldn’t take Boomers lightly. Why?
“Because there are so many of them, they have money and you’re going to be renting to them,” she said at the National Apartment Association Education Conference and Exposition in San Francisco. “So there are lots of people out there who are going to be considering housing alternatives.”
Goss said that 29 percent of Boomers are renters, and that number is growing. The Great Recession is partly the reason, but Boomers are downsizing (and in some cases escaping situations where children return home to live). The demographic has accounted for more than half of U.S. rental growth the past 10 years and the number of 65-plus renters is expected to double by 2030.
“These are demographic characteristics that will very much impact the rental housing industry,” she said.
Renting can be less expensive than owning and flexible
Renting, says Annie Gerard, who is Vice President-Advisory at Meyers Research, is an easy step into retirement, plus today’s multifamily communities offer convenience that Boomers have traditionally sought.
“They really like the concept of onsite management and maintenance,” she said. “They like that someone else will take care of upkeep –, particularly for those who are long-time home owners who know what it’s like, the convenience of having someone else take care of all of that is really appealing. They like the idea of lock and leave, so they can travel. They like the flexibility of not being tied to housing the way they would be if they were in ownership. And it can be less expensive to rent than own (considering upkeep, landscaping, etc.), freeing up money for investment.”
‘It’s a phenomenon already underway and intensifying’
Another reason, she said, is that Boomers want to avoid having to sell their homes later in life. Making a clean break while they are young enough to travel and enjoy their retirement is inviting. So is moving out of the suburbs and into urban centers, where access to culture, the arts, restaurants, shopping and public transportation are playing large roles in decisions to move.
Also, amenity-rich communities are appealing to some, Gerard said. They like upscale interior finishes; large, open floor plans; and storage, storage, storage.
“The quality level is a lot higher than older single-family homes,” she said. “Apartments have a plethora of common amenities, and that amenity rich lifestyle is definitely a draw for urban renters.”
Ditto on services. Not only is maintenance and management a big consideration, but so is concierge service, deliveries, dog walking and activities.
“Those are all things that are helping to push Boomers into the rental market and why half of all rental growth in the last 10 years has been Baby Boomers,” Gerard said. “It’s a phenomenon already under way and intensifying.”
Boomers are still a physically, mentally vital group
When marketing to Boomers, panelists suggested an upscale look with clean, elegant messaging and fonts. Boomers like to be depicted by younger, attractive Boomer models, and sophisticated renderings and photography sell.
And don’t refer to them as “elderly” or “seniors.”
“Try to avoid any kind of age-oriented language,” said Susan Sirota, president and CEO of Market-THINK, LLC. “Two-thirds of those 65 and older report they have no limitation in normal activity. They’re still a very physically and mentally vital group.”
And they’re looking for that care-free apartment lifestyle. Minus the Harvest Gold and Avocado Green, of course.