12/14/16 Millennials Are Changing Multifamily + Higher Density Housin
System - Tuesday, December 13, 2016
Update for Portland Landlords
Millennials Are Changing Multifamily
What it is:
With more than 75 million members, Millennials now outnumber Baby Boomers as the nation’s largest living generation. This has had a noticeable effect on multifamily properties as this population has different expectations and desires when it comes to their taste in housing. A common theme is that Millennials are looking for “walking amenities”. Unit size is far less important than convenience and location. Unit square footage is shrinking, but new developments are walkable to shopping, coffee shops, and work. If it is not walkable, there is an expectation of mass transit being nearby. Millennials are looking for higher quality gyms that are onsite, tech-focused amenities, and good coffee nearby. In Portland, this demographic continues to grow. In a recent survey, apartment research firm ABODO found that Millennials ranked Portland their 2nd favorite city, ranked only behind Seattle.
Why it’s important:
Staying in touch with what Millennials are looking for in housing is very important in the Portland market. There will be higher demand for properties near MAX routes, and in areas where we are experiencing significant job growth. Improving properties to cater to this tech-saavy demographic can also pay off, as Millennials value high speed internet connections, and properties that are wired to fit their needs.
The Portland City Council debated last week on how much single family housing will be rezoned for higher densities. The current recommendation will allow multifamily housing within ¼ of a mile of designated urban centers, corridors with frequent bus service and high capacity transit, and in housing opportunity areas such as near parks and schools. Opponents argue that the rezoning will destroy the character of existing neighborhoods, and some would prefer a smaller area to be rezoned (1/8 of a mile). A decision will likely be made by the end of December, and rezoning changes would take effect in January of 2018. Regardless of the extent of rezoning done at this time, 123,000 new households are expected here by 2035.
Why it’s important:
Many of the properties we manage may fall into this rezoning area. The potential to convert single family homes into multiplexes may result in higher property values, and the potential to redevelop properties to generate more rental income for our clients. Experts in our area say that we have a “missing middle housing” problem, with a shortage of duplexes and cottage clusters.