From Porches to Penthouses:
Behind the Rise of Baby Boomer Renters
For baby boomers, the dream of a white picket fence is losing its luster. Many are trading porches for penthouses, entering the multifamily market in numbers far surpassing millennial stats. Here’s why they’re moving — and what they want.
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“Renting is not just for the younger generations anymore. Increasingly, Baby Boomers and other empty nesters are trading single-family houses for the convenience of rental apartments,” according to Dr. Norm Miller, a Professor of Real Estate at UC San Diego, interviewed by the National Multifamily Housing Council.
A recent analysis of U.S. Census data paints the same picture, revealing: “renters over the age of 60 who live in cities of at least 100,000 surged 43 percent during the decade ending in 2017.” On the other hand, it found “renters under the age of 34, or millennials and members of Gen Z, rose just 7 percent.” By 2035, it’s predicted that “renters older than 60” will make up 31 percent of the rental market.”
What seems to be driving this switch from porches to penthouses? As 60-year-old Russ Chung explains to CNBC: “As you get older, there are only so many things you want to concentrate on. Apartment life lets you focus on things that matter and get rid of stuff that takes up a lot of time.” Zach Ehrlich of brokerage Mdrn. Residential expands on the idea: “There are a lot of seniors finding they want to have more flexibility,” as well as “sociability, whether they lost a spouse or are separated or just don’t have a family unit.”
Interestingly, Chris Bledsoe, Co-founder of co-living company Ollie, argues: baby boomers are after much of what millennials want. As Bledsoe puts it, “Boomers are seeking something urban. They want cultural vibrancy, the theater. They want to be close to where their kids and grandkids are.”
Now that we’ve covered why baby boomers are on the move — and in considerable numbers — it’s wise to ask: why else should operators be taking notice?
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Forbes writer Susan Tjarksen gets right to the point: “from being the fastest-growing tenant profile to experiencing less rent burden to staying in one place for longer than other demographics, baby boomers are the ideal tenant in today’s luxury multifamily space.” First, Tjarksen covers the basics: “rent burdenship — the percentage of income a renter spends on his or her rent — has a strong correlation to a renter’s overall income.”
Then, she emphasizes the upside of baby boomer renters over a much-sought-after demo: “it seems almost too obvious that baby boomers have higher net worth than millennials, yet the assumption is that they are not renting.” Thus, Tjarksen makes clear: “luxury apartment buildings may be overlooking the net worth of retired baby boomer renters.”
But they’re not just financially savvy — baby boomer renters are also an appealing target audience for their tendency to stay put. As Tjarksen notes in Forbes, “Baby boomers are much less likely than millennials to move once they’ve found a place.” Unlike millennials — who might change jobs, start a family, or go through another kind of lifestyle change — baby boomers are “more likely to stay once they find a place they love” than younger generations, according to Tjarksen.
Above all, operators should be pleased to discover that baby boomers are drawn to a range of high-end amenities — ones that naturally translate to steep rents. Tjarksen argues, after all, that boomers want their amenities to signal “they are no longer responsible for caring for the property.”
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Unsurprisingly, the switch from a backyard to a one-bedroom must hinge in large part on… location! National Multifamily Housing Council Vice President Rick Haughey summed it up this way to Greystone: baby boomers “seem to be looking for walkability and access to local businesses and restaurants, so a more convenient lifestyle than they had in their suburban homes where many raised their kids.”
As Forbes notes, “while suburban locations have seen an increase in boomer renters in the last few years, almost a third of rental applicants in urban areas are over 60.” On a basic level, Greystone notes that baby boomers want “well-maintained streets and sidewalks and safe parks” surrounding their new homes. But writer Ryan Coon recommends operators take the location factor a step further and start: “calling out the proximity of your property to must-haves like grocery stores, gyms and shopping districts can emphasize the property’s appeal.”
Importantly, as AARP has found, “apartment-dwelling boomers also look for convenient access to hospitals and healthcare facilities, often a feature of densely-populated areas like cities.” However, if apartments are not situated within walking distance of these sites, it’s a key factor that residents can take the bus or train to get where they need to go…
The ability to get around using public transit is also of significant interest for baby boomer renters, as Forbes reminds operators: “older renters will appreciate the ability to get around if they choose to stop driving at night, in bad weather or completely.”
Forbes dives into details when highlighting the allure of “TOD [transit-oriented development] buildings.” Located “near public transit, like bus stops and commuter rail lines,” these properties allow “baby boomers to stay close to home while getting their essentials.” Another perk: these apartments are often located near highways, enabling baby boomers to travel with ease when they want to see family or friends.
High-end, yet supportive amenities
Interestingly, flashy amenities are a selling point for both millennials and baby boomers alike. As real estate agent Phillip Salem remarked to CNBC, “a lot of millennials are moving into brand-new rentals, and a lot of boomers are saying, ‘That’s what I like, too.’” As Philly.com discovered, “baby boomers most value a pool, fitness center, and social spaces — whether they want to be able to still host Thanksgiving dinner or they just want a place to have a few drinks with friends.”
As Forbes writer Susan Tjarksen, a practically self-described baby boomer, argues: “the right amenities for my age bracket are service-based, such as concierge services and package delivery.” Coon also stresses the importance of setting the bar high when it comes to boomer amenities, warning operators to: “err on the side of luxury.” Coon gets right to the point: “if they’ve owned a home in the past, they’re likely used to having their own laundry and parking in a covered garage.”
Unlike millennials, however, baby boomers might need a few age-specific accommodations. As Tjarksen argues in Forbes: “you can help… by offering support features in your properties that will enable them (and their visiting friends) to remain independent for years: hand bars in the shower, excellent lighting in all areas, lever door handles rather than knobs, non-slip tape on indoor and outdoor stairs and elevators or chairlifts when possible.”
Finally, Greystone adds to the complexity of boomers’ amenity hopes, revealing: “while boomers share millennials’ interest in a fitness center, pool and screening room, they also expect more in the way of planned social activities.”
“Some of our friends are 24, one is 82 — and about 20 of us all get together once a month to walk to dinner at one of the local restaurants or meet in the lounge for potluck dinners,” notes Eleanor “Cookie” Adams, a baby boomer renting in suburban Philadelphia.
Real estate agent Phillip Salem, also a millennial renter, revealed that his own building is a balance of roughly 70-percent millennial and 30-percent baby boomer. Salem describes the warm dynamic: “When I’m on the roof deck grilling, there are a lot of baby boomers. They come and sit with us… it’s a community.”
Stories like these support a common bond between boomers and millennials — both crave a sense of community. This is where operators can take a lesson from co-living companies, particularly ones who up the ante from offering community gardens to hosting full-fledged cooking demos.
After all, Greystone notes, “unlike millennials, many boomers only work part-time because they’re retired, so they look for organized programming to fill up their calendars.” The NMHC advises a range of activities for this renter group: from bocce leagues and happy hours to cooking classes and dog-friendly events.
Yet, baby boomers may have their eyes on an even more valuable prize than luxury amenities or compelling events. In an interview with CNBC, New York broker Wendy Sanders makes clear: “they’re looking for maintenance-free living.”
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How does that look on an everyday level? Sanders offers a straightforward visual: “when the toilet overflows, they want someone to take care of it.” But baby boomers’ maintenance dreams don’t stop at quality plumbing. As Philly.com notes, “no more shoveling snow” is certainly up there among the “joys of renting” baby boomers are increasingly discovering.
Greenery can also serve as a major selling point for baby boomers who’ve abandoned their porches and backyards. Philadelphia area renter “Cookie” Adams confesses, “we are surrounded by such beautiful landscaping and grass that it makes it not worth having a house.”
Indeed, an escape from lawn work is what many baby boomers appear to be seeking. As Coon notes in Forbes, “moving to a rental means boomers are freed from lawn mowing… and many other headaches that come with owning a home.” Above all, Coon has a strong recommendation for operators: transparency. He suggests: “emphasizing the extent to which you maintain the property and speed with which you respond when something goes wrong can help win over a renter who has owned a home.”
Baby boomers like 60-year-old Russ Chung, a New York City transplant, are looking for this kind of reassurance: “As you get older, there are only so many things you want to concentrate on. Apartment life lets you focus on things that matter and get rid of stuff that takes up a lot of time.” Chung’s building accommodates just that state of mind, with the concierge signing for packages and arranging all housekeeping needs.
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As more and more baby boomers trade backyards for one-bedrooms, now is the time to cash in on their quest for “maintenance-free living.” Forbes writer Susan Tjarksen makes clear: “baby boomers may be the oldest generation that’s renting en masse, but they’re a bloc that should not be forgotten by multifamily developers.” From high-end amenities to transit access, there are a range of ways you can make sure these renters call your properties home.
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