Richmond and Tidewater area residential rental landlords have much to look forward to from the transitioning Boomer generation. Much has been written about the Boomers’ kids, Millennials and their impact on the rental market. Notably, now that the “youngsters” are out of the house, demand for rental units by the “empty-nesters” is accelerating. And that is driving demand for both multi-family rental properties as well as single-family homes.
How much of a Boomer renter juggernaut is expected? A study from the Joint Center for Housing at Harvard University estimates 2.2 million seniors will be entering the rental market over the next eight years. The study estimates 50 percent of them will rent single-family homes with an equal number seeking multifamily apartment rentals.
As further evidence of this shift to an expanding Boomer rental pool, the National Multifamily Housing Council (NMHC) projects that folks 65 and older will represent about 60 percent of the increase in apartment renters by 2023. The Urban Institute predicts a rise from 5.8 million senior renters in 2010 to 12.2 million in 2030 … double the number of senior renters today … and requiring 6.4 million additional rental units.
What is the potential for residential rental investors in Central Virginia? Considerable … based on five key factors embodied by the Richmond and Tidewater areas and much sought after by seniors.
Appeal of college towns: Kiplinger’s Personal Finance magazine named “10 smart places to retire” referring to college towns with great appeal to Boomers. The article highlights that towns with a university presence offer intellectual stimulation, spectator sports, arts performances and displays, good dining and a collegial atmosphere.
As quoted in a Richmond Times Dispatch editorial, “The Richmond metro area boasts a thriving academic community – the University of Richmond’s campus rivals the University of Virginia in beauty. The region has a full slate of cultural attractions and attention-grabbing food scene.” Much the same may be laid to claim by the Tidewater area.
Walkable attractions: At a recent NMHC conference many landlords reported that Boomers want to rent within walking distance of shops, restaurants and entertainment. They want to take classes, stay active and enjoy cultural venues.
Availability of superior medical facilities: US News recently released their rankings of the top Virginia hospitals. Not only does Virginia have 4 nationally ranked hospitals, we have another 15 that are regionally ranked for their superior performance. Those in the Richmond/Tidewater areas include: Virginia Commonwealth University, Sentara Norfolk General Hospital, Bon Secours Saint Mary’s Hospital, Sentara Leigh Hospital and Johnston-Willis Hospital.
Affordable lifestyle: Sperling’s rates cost of living on indices based on a U.S. average of 100. Overall, Richmond, Virginia cost of living is 95.40 and Tidewater about 98.6. Within the Richmond/Tidewater areas are smaller communities where the cost of living may be cheaper yet.
Climate: Virginia’s weather has been described as a “Goldilocks Climate” — not too hot; not too cold — and is officially considered a humid, subtropical region. Its moderate four-season climate is particularly attractive to renters relocating from the northern part of the country as well as the “half-backers” who move to Virginia after a Florida residency proves unsatisfactory due to heat and congestion.
The presence of all of these pluses will continue to attract Boomers to our region.
Driven by the desire to be less tied down to the responsibilities of maintaining a home, Baby Boomers are attracted to the comforts of renting. They are motivated to downsize to rental housing as an alternative and simpler lifestyle.
That is not to say that they don’t have demands and expectations from such a move. In addition to the five desirable regional elements described above, here are several that are on the top of most Boomer’s list. Residential rental investors, landlords and property managers must take notice to prepare their units to deliver what Boomers anticipate as “givens”.
Low-care living: Whether it is an apartment or single family home they want to be free of the day-to-day concerns that may range from not having to replace batteries in those pesky smoke detectors that keep beeping … to prompt attention to plumbing or electrical failures. This generation has a low tolerance for things that don’t work right or require extra effort on their part. Single family home landlords should include all maintenance and yard care services. Apartment dwellers want assurance that property managers are prompt and responsive to repair and maintenance requests.
Two & Three Bedroom Units: They want sufficient space for an office and overnight visits from children and grandkids.
Amenities: Boomers’ expectations include high-end fixtures and appliances in kitchens and baths.
Accessibility: Landlords should be alert to the desire of Boomers to “age in place”, meaning being able to remain in the same residence for an extended rental term because the property is outfitted to appeal to those with growing mobility issues. Simple, but important and desirable features to include are step bathtubs and grab bars near the toilet and in showers.
Storage: A move to apartment living from larger single family spaces highlights the differences in life style that entails. So, storage space becomes an important differentiator. Often a combination of centralized storage coupled with adequate close space within the rental unit is well received by Boomer renters.
Social Activities: Multifamily apartment buildings should feature a community room for social gathering. On-site health facilities are a well-received plus. Regardless of the rental type, multifamily or single family home, emphasize nearby community events and activities that will appeal to Boomers who want to remain socially active in entertainment venues and/or volunteering.
Technology: Increasingly, many Boomers are becoming tech-savvy. Others … not so much. So, landlords should cover all bases to satisfy the broadest swath of potential renters.
The search for a rental unit typically is initiated via visits to the property’s website. Therefore, website marketing is essential to attract this group. Note: A recent study shows that 37% of renters older than 40 said they decided against visiting a community based on its website.
Boomers want to deal with a leasing agent and are not prone to submitting on-line applications. Likewise, many desire internet speed in the building, plus WiFi.
So, for all the reasons discussed above, the Richmond/Tidewater areas are nearly perfect destinations for Boomers seeking to rent. With the sheer volume of new renters entering the market over the next decade, residential rental investors will enjoy an ever-expanding pool of prospective tenants. Make sure you have your ducks in a row to attract and retain quality renters to ensure your fair share of a burgeoning market.