Multifamily Executive Special Report: This is the third and final installment in a series of articles investigating the myths and realities of three demographic groups that promise to drive demand in the apartment industry.
STEPHANI L. MILLER and Nadia Asfahani Brooks became good friends in high school. When both settled in the Washington, D.C., area after attending different colleges, the pair spent little time renting. In fact, both eventually chose to live at home. And when they finally moved out on their own, it wasn't to apartments. It was to a condo complex in Huntington, Va. First, Miller bought in 2001, when she was 24. A year later, Brooks followed, at the age of 25.
For Miller, the decision to buy was a no-brainer. At the time, a mortgage payment in the D.C. area was cheaper than rent—and she could build equity. What's more, unlike the generations of women before her, she could buy. “We have more options than our mothers and grandmothers,” she says. “Their options were, basically, live with your parents and be an old maid or get married. We have so many more options. We're employed at almost the same level as our male counterparts, and we recognize a home for the investment that it is.”
Brooks, too, found that owning made as much sense as renting. “It was something that I knew was mine,” Brooks says. “To know that I could make it on my own, as opposed to needing to have somebody.”
Unfortunately, few apartment owners are aware of the preferences of Miller, Brooks, and women like them—the Sex and the City generation of single women between the ages of 20 and 34, who number roughly 14.9 million in the United States, according to the U.S. Census Bureau. Nationwide, roughly 16.4 million single women of all ages are heads of households; 6.7 million (40.9 percent) of those women are renters. Single men, in contrast, are heads of fewer households—owned or rented. While apartment executives have been preparing for the arrival of Generation Y and addressing growing demand from immigrants, many seem to overlook single women as a demographic group with its own preferences. And as such, they may be missing a golden opportunity. Perhaps it's because the numbers suggest women are more likely to buy than rent at a younger age. But there are ways to capture single women in the rental pool through careful design and security features, so long as you don't perpetuate the stigmas they face in the market.
This is the third in a series of stories exploring the myths and realities of three demographic groups that promise to drive multifamily demand over the next decade. MULTIFAMILY EXECUTIVE examined the trends and data and culled anecdotal evidence from apartment executives in the field to discover what it takes to court affluent single women.
Apartment owners don't understand single women.
The truth is that single women are an especially attractive pool of potential residents. They are more prone to saving, better educated, and form more new households than their male counterparts. They graduate from college at higher rates than men—about 33 percent of women 25 to 29 had a bachelor's degree or higher in 2007, compared with 26 percent of men in that age range, according to the U.S. Census Bureau. And there are 14 million female-headed households with no spouse present. Yet the apartment industry hasn't seemed to notice.
Many of the apartment REITs and large private firms contacted for this article said that they hadn't “specifically targeted” or “specifically focused on” single women. “We haven't undertaken and haven't specifically observed a lot of new research or thinking about this,” says Laura London, managing director of marketing at Kettler, a Washington, D.C., area apartment developer. “This is something we should know more about in real detail than we do. I don't know why people haven't investigated it further.”
For its part, the team at AvalonBay Communities, an Alexandria, Va.-based REIT with 48,158 units nationwide, is cognizant of the demographic and psychological shift. “The empowerment of young, single women to make a housing decision today versus a generation or two ago is clearly an important component of what we have to target,” says Christopher Payne, vice president of development for AvalonBay.
The Bozzuto Group, a Greenbelt, Md.-based apartment builder and owner with 70-plus properties, works to make sure its designs do not look too masculine and thinks its peers are doing the same. “We always think about the female renter,” says Julie Smith, president of Bozzuto Management Co., the firm's management arm.
Still, others see women making the bulk of the housing choices. “Whether it's single women, couples, or roommates, we see in a vast majority of cases, they're the decision makers,” says CEO Larry Connor of The Connor Group, a Dayton, Ohio-based firm that owns 14,000 units in North Carolina, Ohio, and Texas. Research backs this up, especially in the for-sale sector. Suzanne Horton, president and CEO of Be Jane, a Web site that encourages women to take on do-it-yourself (DIY) projects at home, says 91 percent of the decision makers in the home buying process are women.