Economy Watch: More Evidence of Apartments Still Having Long Runway via Commercial Property Executive

Any time a boom lasts more than a short while, the question naturally surfaces: How much longer can this go on? Doesn’t the party have to end sometime? All good times do come to an end, but in the case of the running boom for U.S. apartment properties, demographic data (demand) and development data (supply) are still on the landlords’ side and likely will be for at least another decade, if not longer. In short, there are a whole lot of renters in the market or preparing to enter the market, which is the demand side; but not as much development as one would expect, considering that demand.

A relatively youthful population bulge forms the demand side. Young adults have long been predominantly renters, and that might be even truer now, since young renters of today lived through the housing-led recession, and might (possibly) be more inclined to rent than buy. But even if they want to own property as much as their parents, the Millennials and their successors will still be a formidable renting class over the next decade. Put all Americans from age 20 to 34 together, and the total is more than 66 million in 2015, up from 60 million 2005. By 2025, that age cohort’s going to number more than 68 million; and in another 10 years, nearly 70 million.

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