Gen Y & Real Estate at ULI
The Urban Land Institute's fall meeting is always packed with interesting, personable speakers, and yesterday's press briefing on a new Gen Y survey was no exception. The survey was designed for ULI by Lachman Associates, and was conducted nationwide with respondents aged 18 to 32. ULI CEO Patrick L. Phillips and ULI Governor Leanne Lachman presented some of the survey's results, noting that the answers could impact real estate significantly in the years ahead.
Phillips pointed out that the survey made a particular effort to study a racially and socioeconomically diverse group of 1,241 Gen Y'ers in an attempt to draw out the most accurate and wide-ranging data possible. And Lachman explained the sheer numbers of Gen Y'ers. "Generation Y makes up 25 percent of America's current population," she said. "It's going to keep growing as immigrants arrive in the U.S. as young adults." Added Phillips, "This is the generation that's going to be driving the major housing development patterns over the next decade or two."
67 percent of the survey's respondents said they expected to own a home in 5 years, demonstrating that the general desire for homeownership hasn't vanished. But Phillips pointed out that many of those surveyed could have trouble coming up with enough money to buy a home. "It's likely that one path toward homeownership will be smaller or lower-cost units, which may have implications for manufactured housing or high-density housing," he said.
Rental housing, of course, will continue to be a common option for this group. "4.3 million Gen Y'ers turn 22 each year through 2017," Lachman said. "So that's a very steady stream of the younger contingent of Gen Y, who will start out as renters." A surprisingly high 28 percent of respondents who said they expected to be renters in 5 years listed a single-family home as their preferred housing. Phillips called that figure "interesting" for its potential "impact on the rental market for single-family housing."
The survey's results will be more thoroughly analyzed and released in a monograph by the end of the year. Lachman says it will contain "more details and implications for real estate." I'm looking forward to seeing it.--m.d.