Let’s be honest… there isn’t a lot that Millennials and Baby Boomers have in common these days. Except that is, housing. For so long, owning your own home was part of the American Dream. As a family grew, they might upgrade and purchase a larger home, but it was always with the plan to own instead of rent. That isn’t quite the case anymore and this is important for real estate investors to pay attention to.
With Millennials, renting is more popular than buying. The idea of being able to get up and move without a lot of strings attached has it’s appeal to this generation, which makes renting a home or apartment more appealing than owning. By renting, they can move to another city every year or two if they’d like without much issue.
Now the Baby Boomer generation was more traditional and a good amount of them owned their personal homes. They put in the hard work of maintaining the property but as they grow older, home maintenance becomes less appealing and being able to rent becomes more desirable.
This means more people are renting these days than ever before.
Now we’re not saying to go out right now and rack up a bunch of buy and hold properties, but it’s important to consider when you come across a deal that would make sense to add to your rental portfolio.
These generations aren’t wanting big houses either. A 3 bedroom, 2 bath would be ideal for many and some would even be okay with a bit smaller, which is great for investment-type properties.
When you do take down a rental property, consider who your target audience is going to be? Would it be more suitable for the Millennial or Baby Boomer generation? Think about features they’d want in the house that would make it more appealing. Wifi and USB outlets make sense for the younger generation while safety railings in bathrooms and one-story properties are important for the Baby Boomer generation.
Baby Boomers don’t mind being out in the suburbs in the quieter, safer areas of town. Meanwhile, Millenials want to be close to entertainment and shopping, typically.
Be smart about your rentals. Build your portfolio as it makes sense and spend just a bit of time considering your target tenant.