Obvious statement of the week: Real estate investors and managers need to stay up-to-date on evolving housing needs. One critical demographic to watch as a harbinger for shifting housing momentum is young adults, particularly where they migrate to in larger concentrations. Young adults tend to migrate once they have finished school, and where they move, they tend to start familes and companies, they spend money, they increase the population and economic activity. They often head to where they can find work, along with cultural stimulation like social, arts and entertainment hubs. As a rental investor or manager, you can stay a step ahead and provide the housing if you know the trending hot spots.
Forbes is one solid source for finding information on trends for the millennial generation. The site even breaks information down into neighborhoods, further helping investors. If you can catch the market before it explodes and prices rise, you will realize a solid return on any property investment you make. Some of today's (and perhaps tomorrow's) hot neighborhoods for millennials include:
South River City, Austin (pictured above)
Texas offers better weather than many northeastern cities and young adults can enjoy the outdoors all year. South River City is close to Lady Bird Lake and plenty of recreational opportunities. Another major draw for the area is a lower than average crime rate.
Oak Lawn, Dallas-Fort Worth
If you are considering investing in property in Texas, this neighborhood is also on the hot list for millennial migration. Oak Lawn is attracting young adults with lower than average rental costs and a below average crime rate. Millennials still get all the benefits of living near a large metro area for work and entertainment.
Brooklyn & Greater New York City
According to Forbes, the Greenpoint neighborhood of Brooklyn ranks in the top for residential selections for millennials. The city itself is likely out of the financial reach of recent college graduates, but the draw to the area is large. This area keeps recent graduates due to the location of New York University. It attracts new adults with a reasonable ratio of housing costs to income average.
Arlington, Washington, D.C.
The Clarendon neighborhood is valued for a higher median income range while still offering affordable housing rates. With Georgetown University nearby, many graduates will remain in the area. The area has a strong Metro service, which attracts an eco-friendly generation.
Cow Hollow Neighborhood, San Francisco
The San Francisco area is diverse and offer millennials all the entertainment and social opportunities they could possibly want. Cow Hollow gives young adults more affordable housing opportunities while still boasting a reasonable median income. The crime rate is considered average. This allows migrating young adults to have a city-like experience in a neighborhood setting. According to Bizjournals, the area is seeing rapid housing growth in the condo market.
Little Italy, San Diego
Another option for investments in California includes this neighborhood of San Diego. While living costs are high in Southern California, the benefits to residents make up for the increase. Little Italy boasts a low crime rate and gives residents proximity to numerous job markets.
Spring Hill, Boston
The Spring Hill neighborhood appears to be a strong one in attracting millennials. Plus points for the area include many diverse neighborhoods, lots of colleges and solid technical opportunities. The crime rate for Spring Hill is below average and living costs and median income are well balanced.
The town of Morrisville is included in the top list for good reason. The average rental costs and crime rate are low. The median income is similar to that of areas that are more expensive. Much of the Carolina region is booming with new industry, this coupled with a reasonable climate and vibrant social atmosphere, are drawing in migrating young adults.
A total of 25 neighborhoods are included on a list produced by Niche.com. This list is based on surveys of current students and recent college graduates. Factors for migrating include affordable rent, solid employment and lower crime rates. Millennials are also looking for areas that offer them shopping, attractions and nightlife.
The millennial generation is defined as young adults currently between the ages of 18-34. This group has been impacted by changing economic conditions. This brings them to searching for more than just high-paying employment, which is harder to find. Areas that provide a balance of work and life opportunities are where you will find this generation.
Another method to try when determining trends is looking at current college and university enrollments, and the major fields of study. As this generation can be inclined to stay put, if you notice an increase in majors in one college area, look at the potential work opportunities nearby. Focus on a neighborhood that will attract young adults and you can create your own market boom.
What other methods are good for figuring out where young adults are heading next? Do you look at areas with large industrial and commercial construction growth? Let us know what you think!