The Next Generation Of Renters: How Landlords Can Prepare For Gen Z Tenants
Updated: Jul 7, 2019
When you scan the internet for 2019 real estate trends, you'll find a lot of different opinions about what the year will bring. However, one consistent theme is that we will start to see more and more millennials purchase homes. Whether it is because they are aging or feeling more financially stable, there’s no doubt that this generational powerhouse will be a large influence in this year’s real estate space. In fact, some experts are anticipating that 34% of this generation — currently encompassing some 70 million individuals born between the early 80s and mid 90s — will buy a home in the next five years.
At face value, this means that real estate agents and real estate marketers will need to shift their focus to sell homes effectively to a generation that has previously baffled them. Finding their pain points, addressing them and finding exactly what will create that tipping point toward a purchase will keep this group on their toes. Understanding the millennial propensity to seek information from peers and online first, their “recession mindset” and other unique traits will be important for selling real estate. But one question that hasn’t been explored in the face of this trend is how millennials “growing up” and purchasing homes will affect the rental market. It makes sense that property managers and landlords will start to shift their focus to the next up-and-comers: Gen Z.
Rental Properties And Gen Z Tenants With the oldest individuals in Gen Z entering their 23rd year in 2019, this generation represents the next wave of renters. If you’re wondering why this is a big deal, trust me — this generation is unlike any we’ve seen before and their demands surrounding rental properties and amenities will be just as different. If you are a landlord or investment property owner/manager, it’s important to have a baseline understanding of what’s driving these teens and young adults in order to prep for your next group of renters.
They are consuming digital media differently. We can’t simply apply the rules we’ve finally established for millennials to the following generation. Gen Z is consuming media in a way that’s all their own, using different social media platforms and watching drastically fewer hours of traditional TV. If you are marketing a rental property, you will need to find ways to meet them on their own turf via online video content and not through television advertising. Messages need to be fast, easily digestible, and ready to share with others. This generation likes to interact with their peers and share information and values the human connection in addition to online sources when making housing decisions
They are tech dependent. These digital natives have never known a world that isn’t completely, immediately connected. They want every aspect of life to be easily accessible through their smartphones. This means as a landlord or investment property owner, you need to take a close look at how you’re interacting with your tenants. They will demand electronic interactions for regular tenant activities like paying rent, filing maintenance requests, basic communication with the landlord and accessing services like purchasing renters insurance.
They are frugal. A recent Business Insider survey showed that, even though this generation is still very young, some already believe that one of the most important issues that they will have to deal with is the economy and debt. Because they have grown up during a global economic crisis, and in the shadow of the relatively “poor” millennials, they will tend to worry about money. This mindset might make them value affordability over extra square footage or unnecessary amenities.
They want to participate and co-create. From creating vlogs to launching their own video channels, this generation has had tools at their fingertips from the get-go to be creative in major ways. This experience of participation and creation is part of who they are, and it stands to reason that this will spill out into other portions of their lives as they begin to enter adulthood. If you own a rental complex, consider amenities that bring people together to help create culture, like group art projects, community events and contests.
Final Thoughts As real estate trends start to take shape for the coming year, property investors and landlords would do well to take a look at how those trends may affect the rental market. The biggest change on the horizon is the coming-of-age of Gen Z, and understanding their needs can mean the difference between a vacant property and a profitable one in the years to come. Article by Nathan Miller--founder and CEO of Rentec Direct, property management software for real estate professionals. View original article here.