Gen Z and Millennials have more similarities than you might think when it comes to housing, and their footing in the apartment scene has staying power. Understanding the lifestyle positions and needs of both groups could help you benefit from this strong multifamily trend, and only takes answering a few simple questions.

Why Are They Renting?

It’s simple really: Millennials entered young adulthood in the early 2000s; they get married later, live with mom and dad longer, and change jobs more often than generations prior.

They also don’t yet feel the urgency to be tied down to a permanent home. The urban lifestyle allows them to be in the hub of activity, with accessibility to the excitement of city life.

As it relates to home buying versus renting, Census data shows that the millennial homeownership rate stands at 48.6%, more than 30 percentage points lower than the rate for Baby Boomers in their 50s and 60s. Among the oldest millennials who reached age 40 in 2021, the homeownership rate is 60% as compared with 64% of Gen Xers and 68% of Baby Boomers who owned homes when they were that age.

Meanwhile, Gen Z — typically born between the mid-1990s and 2010 — is starting to seek housing without the help of their parents. This generation makes up about 27.7% of the U.S. population, likely marking it as a significant portion of your property’s target demographic.

What’s one thing both generations have in common? The current struggles of the housing market and decreasing ability to afford a new home. 

Realtor.com predicts that mortgage rates will keep rising in 2022, making it more and more difficult for Gen Z and millennials to afford a new home in the current economy. An increasingly competitive homebuying market will no doubt continue to increase the demand for rental units. Economists also predict that those who moved in with family during the COVID-19 pandemic may move out this year and resume renting.

The pandemic was also a defining economic moment for Gen Z renters as they were thrust into a housing market that jumped in price. The next few years will show how Gen Z fares compared to millennials in the homebuying market, but according to the Apartment List report, they are poised to rent for the long term.

What Do They Want in an Apartment?

While these two audiences are divided by age and stage, they often want similar things in an apartment.

Luxury and location seem to top the list of demands for both groups. Millennials and Gen Z renters are searching for diversity in their community, convenience to daily necessities, and high-end concierge amenities.

Many apartment communities have already cracked the code on spaces that answer the needs of both millennials and Gen Z renters. What’s important is that you don’t segregate yourself by appealing only to one crowd. 

Take West Plano’s luxury highrise, LVL 29, as an example. In determining the concept and design of LVL 29, the goal was sophistication and modernity with ample personal touches. Upscale co-working spaces may appeal to the professional entrepreneur, while 24-hour desk attendants, concierge services, and package delivery cater to the service-based needs of the younger renters. 

To meet the needs of both groups while bringing residents together, LVL 29 implemented cutting-edge technology in business centers and fitness facilities, upscale pet amenities, and refined lounge spaces. 

How Can You Adapt? 

Whether you are developing new communities or managing existing ones, it’s important to adapt to the needs of millennials and Gen Z renters. 

Multifamily properties will need to adopt amenities that show they understand the needs, hobbies, and life stages of each generation in their target demographic. Large gathering spaces for visiting friends and resident events, luxury lounge areas with a full suite of business amenities for remote workers, and state-of-the-art fitness centers with classes and spinning or yoga studios are just some of the many amenities these generations come to expect from their property.

Providing residents with a vibrant and resort-like community with carefree services and amenities in a maintenance-free setting is how you will set your property up for success.

We also recommend adjusting your social events to highlight your location and meet the social demands of younger and older residents alike. LVL 29 often participates in monthly events highlighting such walkable venues as Legacy West to draw both groups together.

What’s The Bottom Line?

Millennials and Gen Z are renting more and more. In the development stage, consider how you will appeal to them both through amenities, location, finishes, activities, and messaging in order to gain their business for years to come. On an existing property, consider whether resident socials should be adjusted to create community among both groups, or whether the images and messaging on your multifamily website need to be tweaked to resonate with both crowds. Making the necessary adjustments and capturing these apartment leads could mean long-term success for your portfolio.