Axiometrics analyst Louis Rosenthal takes to the pages of Forbes to talk about the medium- and long-term outlook for the multifamily market. And when he says "long-term," he's talking the 2020s and 2030s.
Sifting through demographic drivers, Roenthal posits that millennials—the youngest of whom will be just 20 come the year 2020—will drive the market well into the mid-2030s:
In other words, the youngest of the millennials will still be considered “prime renters” until 2035. Some may think they are entitled, bratty, and materialistic—but they will be driving the apartment market for at least the next 20 years. Only 28% of adult millennials are married, compared to 38% for Generation X when they were 18 to 33 years old.
This suggests that the homeownership rate will continue to fall, which is music to the ears of multifamily owners.
“If the homeownership rate goes down, then the number of renters should go up,” said Jay Denton, Axiometrics Senior Vice President of Analytics. “So, in the end, a declining homeownership rate should benefit the multifamily space, especially given demographics.”