Millennial Renters Charm Triangle
Lifestyle, Technology & Social
There have been tons written about millennials – who they are, what they want and how they differ from previous generations. Now let’s distill all that down for the benefit of you, residential rental investors, in seeking to attract this vast pool of renters
This group, born between 1980 and 2000, represent 60% of renters. There are several reasons why renting is their favored housing option. Millennials share some or all of the following.
- Often face massive student debt which must be serviced.
- Debt service and saving to purchase a home is further impaired by a luke-warm job market for recent graduates.
- Job and geographical preferences for living are much more fluid than previous generations … so a long-term commitment to a house is typically not attractive.
With that as background, what should landlords’ know to attract Millennial renters. The answers are found in the Millennial Renters Charm Triangle … the three decisive categories of importance to this generation of renters. Let’s flesh out each in the context of renter preferences … and in some cases, absolute requirements. As every successful speaker and marketer will tell you, “Know your audience and speak to them as they prefer to be spoken to”.
- Health – Millennials generally seek a healthier lifestyle. In response, many developers have added fitness centers and outdoor areas … to appeal to renters.
- Green Living – Many Millenialls view green amenities and an eco-friendly property as a key factor in their search.” Strata research reported 64% of young adults in the 18-33 age group said they were willing to pay higher rent rates to live in a green apartment community. Property owners will do well to become eco-friendly by having easy recycle options, energy-saving appliances, water-saving shower heads and even composting facility if the property will support it. Long-term, you win as a landlord with significant financial savings; short-term you’ll certainly get the attention of eco-friendly renters.
- Experiences – Here’s a blockbuster of a finding in our culture that traditionally values material possessions quite highly. A recent study by Harris Poll (for Eventbrite) showed 78 percent of Millennials would rather spend money on an experience they wanted to have over an article they desired. Have you got that? Nearly 80% of Millennials would rather spend their money on an experience that will engender lasting memories rather than a physical object with a finite life-span. Make your property an amazing experience that is unique and fun that fosters memorable experiences in both amenities and interpersonal relationships. A simple addition such as adding USB charging stations in common areas, fast internet speeds throughout the community plus quality cell reception delivers an enhanced customer experience with major positive impact.
- Convenience – According to a 2015 Millennial Renter Survey by ABODO, young renters are most likely to seek common amenities such as ample parking, in-unit laundry and utilities included. Beyond the basics, there is a strong interest in controlled building access, easy access to public transportation and outdoor unit space, including balcony, deck or patio. Investing in amenities can raise rent prices, but studies show millennials are willing to pay more for convenience and comfort.
Speaking of convenience, responsive maintenance is a major issue and should be emphasized as a genuine “value-add” for renters. In contrast to homeowners, renters pass service issues to the property management – a real time and money saver.
- Connectivity – tops the list of “must-haves” for Millennials. They are the first generation raised on the internet and social media. Tech is in their DNA. Clearly, this generation does not have an “on/off” switch and often on the go 24/7. Recognizing that, residential real estate investors need to consider the best way to attract this tech-savvy crowd.
- The Go-To Resource – Over 85% of Millennials have a smart-phone and rely on it as their go-to resource for research & communication (plus photo-ops and selfies☺) Millennials don’t just consider a smart phone – a phone. Likewise, tablets are widely used by this tech-savvy group. The point is – mobile devices!
As a property owner, an excellent move is to ensure that your website is optimized to be mobile friendly. That translates to ease on the part of prospective renters to use their mobile device to have a preliminary look at the property, schedule an appointment and complete an application. Remember: Nowadays, 70% of buying decision research is made before contact with the prospect. Compelling videos and floor plan images will help with the decision making process.
Millennials will begin their search for housing online and prefer to complete the rental process in the same way. And once the rental agreement is signed, their preference is to continue with online communications. Remember, this is a generation with text and email as their preferred communication channels. That means property owners are well-advised to recognize they will respond positively to completing the application on-line and an online portal for service requests and rent payments.
- Social Media – Millennial renters are extremely active in social media circles. This group will initiate a search for information through social media resources. They will search review sites for positive and negative postings regarding rental properties. Plus they will share findings with others in their social network.
Property owners: Capitalize on this by using Twitter and Facebook to connect with prospective renters. A very positive approach is to create a Facebook page for rental properties with descriptions, photos and reviews/testimonials by satisfied renters.
Additionally, the use of social media by property owners presents the opportunity to provide education to Millennials in their search for rental housing. This will position the property owner as a thought-leader and expert in helping renters find the most suitable property to meet their needs. That means being welcomed as a guide, not a seller.
- Community – While Millennials rely heavily on social media, it is balanced by a strong desire for personal and social experiences. They very much enjoy to hang out in person and value community involvement.
As a residential rental investor you can help your residents connect by investing in community spaces at your property. These may range from workout facilities, outdoor social gathering spots, rec rooms or even more exotic offerings like a roof top garden or swimming pool.
Finally, remember that the outlook for purchasing a home will continue to remain financially challenging for this group as well as relatively unattractive when renters consider the ease of being a tenant vs. the complications of being a homeowner. Pay attention to the three elements of the Millennial Renters Charm Triangle. Make your rental property a community that supports and serves the Lifestyle, Technology & Social desires of Millennial renters. Your payoff: Differentiation from your competition, Attraction of quality tenants and Exceptional Occupancy Rates.
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