As trends in the real estate landscape continue to evolve, development must also change in accordance with its residents’ emerging needs and expectations. A recent study of Pittsburgh, Pennsylvania, by the Urban Land Institute reveals that millennials, the newest generation to enter the house-buying demographic, have specific priorities in where they live — priorities that may be able to be accommodated in the suburbs just as they can in more urban areas.
If a developer uses traditional thinking, he or she may assume that the younger generation is interested in hip, cool urban areas specifically because of their locations. But the fact is that millennials like the idea of moving to the suburbs — as long it offers some of the benefits of a more urban, downtown feel. It makes sense; the millennial generation is entering the stage in which many of them are settling down with spouses and families. Like their parents before them, they see themselves raising that family in the suburbs.
But what millennials envision isn’t your typical, 1950s-developed suburb. As they are with other industries in their life, young people are demanding changes to the status quo and, in doing so, creating a brand-new vision for the future of suburbia.
Suburban developers, take note. Here are the things the younger generation is increasingly demanding of its suburban living areas:
1. Walkability and Transportation Options
A big benefit of downtown areas as opposed to suburbs has always been access to transportation modes other than cars. Urban residents who don’t own their own vehicles or prefer not to use them can easily take a subway train or choose to bike or walk to their destination. In turn, suburbs are traditionally associated with easy parking and navigation via car. However, there is no reason a suburban community cannot offer both. Commuters, particularly those interested in environmentally friendly modes of transportation or cutting costs, now expect methods of transportation aside from owning their own vehicles. Sidewalks, bike paths and buses are all a must for developers interested in attracting residents and businesses.
2. Proximity to Good Schools
When it comes to housing, a good school district can completely make or break an area. Building near a good school system immediately attracts residents as well as influences potential profits. While it’s true that young people are delaying having kids longer than any other generation in history, many still hope to add children to their family one day — and take those wishes into account when looking for long-term housing. Urban cities have grown to embrace education and medical research industries, but suburbia falls behind. Emphasizing quality education for both children and adults will bring residents in droves.
3. Mixed-Use Business and Retail
One of the benefits of living in a city is the ability to go downstairs or next door and get whatever you need, whenever you need it. Traditionally, suburban retail businesses are clearly separated from living areas. For people who are increasingly dependent on instant, online deliveries, residential properties with a close proximity to retail for their needs are invaluable. When people move to the suburbs, local retail needs to follow, especially for those residents who rely on public transportation.
4. Affordable Housing
No matter how many benefits a suburban living area can offer, the potential pool of residents will be small if affordable housing is not available. Space is limited in the city; when people find out they can have more space in the suburbs for the same price, they are given an incentive to move out of urban areas. But, with the volatile housing market, it’s not enough to focus solely on single-family homes. Affordable housing needs to include multifamily properties such as townhomes and apartments to attract and retain residents in the suburbs who may not be ready for the commitment of a single-family home quite yet.
Young people want more out of their living space than just square footage; they want to feel like they belong. “Co-living” communities — in which smaller and less expensive units are combined with shared space and socialization amenities — are becoming increasingly popular. They provide the same community feel found in urban centers and provide everything a tenant needs in one space. Co-living communities are also growing in popularity for Baby Boomers, as well.
Essentially, what we are seeing more and more is that development trends are catering to the individual that wants it all. Millennials — and other age groups, too — want to be able to access everything in their own neighborhood, or as close to it as possible. We live in a culture that does not prioritize waiting, and we expect to be able to fulfill all of our needs close to where we live and work, whether that’s in a suburb or the heart of a major city. When developers recognize and take advantage of these desires in the suburbs, they’ll find a new demographic of residents they never saw before.
Want to learn more about developing residential real estate, especially multifamily homes? Schedule a consultation with Chris Gardner today.