Are You Ignoring this Huge Demographic?
As a real estate investor, you know how important it can be to tailor your properties and marketing strategies to a particular demographic, or demographics. For many, that group of people is the millennials, those folks who are in their 20s and 30s and who just aren’t as interested in buying their own homes as the preceding generation was.
But what if I told you there was another demographic out there who is on the verge of overtaking the millennials as the largest sector of renters? Would you be interested in changing your strategy?
I’m guessing you would, because the potential for incredible success is right around the corner – with the baby boomers. Yep, the baby boomers. For some of you, this may be people in your parents’ age group, while for others, this includes your grandparents and their contemporaries. Boomers range in age from their 50s to their 70s, and there are about 80 million of them in the U.S. While most baby boomers have a history of homeownership, that is beginning to change, as retirement approaches and the responsibilities of taking care of a house become either too much to handle or people simply don’t want to worry about it anymore.
It doesn’t take a great leap of imagination, then, to realize that this demographic is going to be shifting to become a group who prefers to rent homes rather than buy them. And that’s where you come in. Instead of focusing your investment properties in family-centric neighborhoods or other areas where boomers may be less likely to want to live, start checking out some boomer-friendly places and properties.
Some of the criteria that baby boomers will be looking for in a rental property include:
- Affordability – this is arguably the most important factor for 99.999999% of renters, but it rings especially true for this demographic. Unfortunately, many of these folks are not as financially secure as they would like, thanks to the recession, less-than-stellar savings habits, and uncertainty regarding social security. So affordability will top the list as the most important factor for many of them.
- Local amenities – having great amenities nearby is another feature they’ll be looking for. This includes shops and restaurants that are close (bonus if they’re within walking distance), recreational opportunities such as golf or tennis, and community centers, just to name a few.
- Maintenance-free – Like I said, many baby boomers no longer want to hassle with the tasks that come with home ownership, hence their decision to rent. Including full-service property maintenance is a must for this group.
- One-level living – Not having to navigate stairs is another majorly attractive feature for baby boomers, for reasons that really don’t need explaining.
My advice? If baby boomers aren’t already on your radar, put them there ASAP. As more and more of them retire and look to downsize and free up their time, they’re going to turn to rental homes. You need to be there to provide them. The trick to finding a profitable, sustainable investment is to look in areas that are growing and have strong employment opportunities, while also factoring in those senior needs I mentioned above.