For Millennial Students, Small Apartment Shares Provide First Step to Independent Living
While an overwhelming share of Millennials enrolled in degree programs continue to live with their families, living off-campus in apartment building shares can provide a smoother path toward independent living.
Living with Family Dominates Millennial Housing Trends
The persistence of young adults living with their parents has been one of the most compelling headlines affecting the housing market in the post-recession era. This is especially true for young adults attending college.
As of 2016, of the nearly 21 million Millennials1 enrolled in degree programs, 76% lived with their families across all housing types, as shown below2.
Focusing on the rental market, of the estimated 8.5 million Millennials living off-campus in rental units in 2016, nearly 55% still lived with their families.
Furthermore, about 35% of Millennial student renters shared off-campus accommodations with other individuals, while 10% lived alone–both at twice the rate across all housing types.
Small Asset Shares Vital for Off-Campus Renting
A closer examination of the living arrangements of Millennial student renters reveals the significant role small asset multifamily properties play in catering to this demand segment and providing the first step toward independent living.
As depicted below, of the Millennial student renters sharing accommodations, small asset properties captured a demand share of 41%, followed by single-family rentals at 28%.
Large apartment properties comprised only 13% of the rental share demand due to a lack of available inventory combined with the higher average unit rents.
Of those Millennial student renters living alone, small asset properties corner an impressive 52% share of this segment, dwarfing the next largest category, large properties, at 19%.
On the other hand, small apartment properties also cater to Millennial students living with their families, constituting a 26% share of this segment, as compared to 7% in large properties.
A combination of factors, including lower average rents, larger units and urban proximity, allow small apartment properties to cater to Millennial students in a variety of different ways, including living independently and with their families, while maintaining steady growth prospects.
1Millennials are defined as 18 years and over in 2016, born in 1982 or later.
2All data is sourced from the American Community Survey (ACS), unless otherwise stated. ACS statistics are sample-based estimates of the compositional profile of the total population in the given year of data collection, and include a margin of error.