Real Estate Marketing & Beyond
There’s an awful lot being written about millennials needs for housing these days, particularly as they outnumber baby boomers. However millennials are facing competition in the real estate market that’s coming from this generation, many of whom have either retired or are on the cusp of retirement.
This does mean that people bidding on apartments in urban areas could well be baby boomers. According to the article in realtor.com, 10,000 baby boomers are retiring every day, and as many are looking to downsize they are also increasingly interested in purchasing the type of urban property that is normally associated with college graduates.
Amazingly, baby boomers are buying condos and renting apartments at more than twice the rate of millennials.
Millennials are the fastest growing group of new homebuyers in the US and there are 83.1 million of them so it’s a little wonder that developers have been creating property specifically designed for those born between 1980 and 2000. Apparently millennials prefer to have bike storage, live in walkable neighborhoods, enjoy modern architecture and want easy access to restaurants and cafes. But so do baby boomers and they have one major advantage as they have much more cash to spend and they are willing to pay a premium to get exactly what they want.
While millennials are looking for starter apartments such as studios or one-bedroom properties, baby boomers have different requirements and are looking for high-end properties with two-bedroom units and large kitchens that remind them of the suburban homes they’ve downsized from. A lot of new condo construction is now being aimed at the luxury end of the market so there are fewer affordable properties for first-time buyers, particularly as the number of new construction permits has declined. In September figures from the Commerce Department showed a 5% fall in building permits compared to August. Unfortunately the decline in new permits does mean that both markets are unlikely to be satisfied in the near future and baby boomer demand is expected to continue.
Many baby boomers approaching retirement age are rejecting the idea of a traditional retirement and the type of housing associated with it. Nowadays very few so-called “cruise ship” developments are being built. These developments tended to be self-contained communities that were miles away from anything else. Now the trend is towards age integration and this may lead to adding units to existing properties to create multigenerational housing or designing a building that will appeal to a wide age range.
