Understanding today’s renters, and knowing your key demographics, are both crucial for the success of your property management business. Appfolio is a good resource and provides web based property management software, and free webinars for property management professionals. The following information can be found at apfolio.com. This insightful presentation with Zillow’s Senior Economist, Skylar Olsen will break down the demographic trends that are driving growth in the single-family residence rental market, and some of the key differences between SFR renters, SFR owners, and multi-family renters.
Rental markets are seeing increased pressure at 3.7% higher than last year. This produces a lot of competition for both renters and owners. This increase comes from population growth, job relocation, and supply and demand. Single family homes are taking up 42% of the rental market. Many people in this category are those who are just starting out, or unfortunate families affected by the unemployment crisis. Both supply and demand play a big part in the demographics of the rental system. For many different reasons, the new households formed since 2005, are funneling to the rental market. 52% of single family home renters have children, and 45% are single parent households. Housing and transportation are the two largest expenses of living.
Who is the single family home renter?
- Younger married couples who have children and are ready to start out on their own.
- People who need more space than apartment renting
- People who cannot afford a down payment or startup costs.
- People who are not ready to put down roots yet, but need the space
- Single parents in a transitional period, such as divorce
Who is the single family home landlord?
- Those with negative equity in their homes waiting for the value to increase so they can sell
- Investors looking to make a profit
Renting is, and will continue to be, a huge part of people’s housing lifecycle. Many single family home renters are in a transition period. According to the 2014 census, the top 5 reasons renters move out of their current location are:
- Newer or better housing options
- Establish own household
- Easier commute
When Zillow asked hundreds of current renters why they don’t own, they said:
Income affordability (53%)
- Because I can’t afford the maintenance, taxes and monthly payments (18%)
- Because I can’t qualify for a home loan (16%)
- Because I don’t have a down payment saved (13%)
- I receive government assistance with my rent (6%)
- I simply prefer to rent (20%)
- I could afford a home but not the style, size or area I would want (4%)
- I like the amenities available I my rental complex (2%)
- I am not sure how long I will live here (14%)
- I have recently sold my home and haven’t found anything to buy yet (1%)
Many people rent for many different reasons. By knowing the rental market, and what the renter is looking for, property management companies can increase business be able to better serve the rental market. With so many options for online searching, renters are empowered to find exactly what they are looking for. It is important for property management companies to put as much detailed information on line as possible, so neither party wastes time in asking questions that shouldn’t need asking. So if you are ready to boost your business, and improve your company’s customer service, check out more free information from appfolio.com.