Hidden Figures: What’s Really Happening in Multifamily
It’s a truism that has taken on new meaning in recent years – all people need someplace to live. And in the early years of the 2020s, home buyers were encouraged by exceptionally low mortgage rates to purchase rather than rent a home.
Demographics played a role, as well – the largest generation in history, the millennials, were in their prime household formation years and now comprise 38% of the homebuying market, up from 28% in 2023, reports the National Association of REALTORS®1. In addition, buyers have not been waiting until marriage or partnership to buy a home. Nearly half (42%) of millennials have purchased a home alone, acompared with 22% of Gen-Xers and 22% of Baby Boomers, according to BankRate2.
The result: higher prices in for-sale housing that have lingered, deterring purchases and boosting the rental market, creating a supply issue in multifamily. Trade organizations report that a shortage of affordable multifamily housing remains, resulting in rising rents. But national figures are deceptive, as you’ll see in the following pages. Supply, demand, rents and even desired amenities and services for rental homes vary widely by region. These hidden figures are the real story behind the real estate story.
Because, as you’ll see, people want more than just housing – they want a home. The challenge going forward for builders and operators will be to create these communities, often with more home-like amenities, in a way that serves their users and investors.
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