The pandemic’s short-term effects were swift and strong in 2020, leading to record-low mortgage rates and a surge of new renters who were either relocating or downsizing. As this initial shift leveled out toward the end of 2020, we’re now able to see new shifts taking hold and anticipate trends for 2021. Find out what you need to know to make smart investments, attract new renters, and win long-term trust among existing renters with our 2021 rental market analysis.
Rental Size Matters More Than Ever
Tiny homes and studio or one-bedroom apartments aren’t going away anytime soon, but the pandemic pushed a few significant changes, and rental size is one of them. For some families, a larger home is simply the result of living in close quarters during quarantine and realizing that personal space is a bigger deal when everyone is home. For others, quarantine created the need for at-home workspaces and larger common areas.
And for others, a larger home is the result of some families and friends making the switch to consolidated living arrangements. Gen Z and millennials, in particular, have been co-living for years, but the pandemic has added to the volume of this rental market. Given the multitude of reasons to go big, renters are seeking out more spacious rentals as well as more rooms — we are seeing a greater increase in multi-bedroom apartment rentals than of compact rentals with lower square footage.
Remote Work Is A Heavy Influence On Location
Now that so many companies have indefinitely shifted to remote work, people are no longer tethered to their location. Some are moving closer to family members, but the vast majority are moving to desirable cities. In most cases, and certainly, for millennials and centennials, this means large cities are seeing the highest influx of rental searches — with an extremely low inventory.
This is pushing many people into suburbs surrounding these larger, more desirable cities. Overall, we’re seeing a high-rent, low-inventory situation in the cities with urban sprawl, and a rise in suburban-living. Unfortunately, building costs are also on the rise, so while more units will augment city populations, they won’t provide much relief to those looking for lower rental rates.
The Digital-First Smart Home Experience Leads Decision-Making
Given the vast influx in remote work, residents expect homes to handle multiple devices, heavy bandwidth usage, and smooth streaming experiences. Reliable, fast and broader bandwidth connectivity must be available all day and from anywhere in the home to include patios and balconies. And it isn’t just up to the utility company to offer faster connections — homes need to be wired for the best possible connectivity and offer more outlets with better placement for more effortless charging. Expect to do your part as a manager or owner to negotiate for closer cell towers while adding boosters to your area if you are outside city limits.
Beyond connectivity, residents are also increasingly interested in better living experiences and safety. Being able to showcase built-in safety solutions and convenience are paramount. Think about smart home technology with keyless entry, security cameras, and smart home hubs, all of which can be accessed from multiple approved devices. This not only meets the increasing demands of residents but often saves money for owners and dwellers alike.
Final Thoughts On The 2021 Rental Market
Historically, the best time to list a home is in springtime, while sales and rentals tend to get a bump in the fall. However, the increased adoption of technology has made home buying and rental shopping more accessible year-round from any distance.
Many potential renters are searching for space, location and tech they want from the comfort of their couch. However, when it comes time to view a property in person (let’s face it, many renters won’t rely on virtual tours alone), PointCentral’s unattended showings feature will create more freedom and security for renters to tour homes without an agent or property manager. This ongoing shift means 2021 may bring more fierce competition to the market, favoring homes with the right specs, even though property owners may plan to benefit from current rising rental rates and low inventory.
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