7 Game-Changers Affecting the Apartment Industry
Business Solutions The apartment industry houses nearly 39 million people, and demand for apartment living is growing. In fact, the industry will have to build at least 4.6 million apartments by 2030 just to keep up with demand.
Tomorrow’s renters’ needs and wants will be very different thanks to game-changing shifts. These shifts will radically reshape residents’ expectations and experiences.
Here are seven things the industry needs to consider when designing, developing and operating new communities and apartment homes.
Technology will become part of the core design of communities rather than just an add-on. Smart-home automation and artificial intelligence will drive innovation and technology while also enriching the resident experience.
E-commerce has reset consumer expectations by shifting the balance of power in favor of consumers. As real-time and personalized-purchasing experiences become the norm, a lifestyle-focused, flexible and highly-personalized apartment is as important as location and layout.
In the coming years, apartments will have to serve a greater variety of households and housing needs. A NMHC 2018 Consumer Housing Insights Survey found 83 percent of respondents believe it is important to have a space that evolves with different stages of life, while 78 percent believe it is important to have a space that can transform to meet different needs. Adaptability in physical components of community construction will be increasingly valued.
Mobile technology, telework, growth in non-traditional jobs and increasing participation in the gig economy are disrupting where, how and for how long people work. This impacts a consumer’s housing priorities, preference and decisions. Residents will expect to have the infrastructure associated with offices, such as high-speed internet and co-working spaces, provided within their communities.
A revolution in transportation is underway. Ride sharing and electric and driverless cars stand to challenge parking assumptions and free up millions of square feet of parking space. Apartment communities will need to adapt to fluctuating parking needs and an increasingly diverse range of mobility options.
A growing consumer emphasis on wellness means apartments will be valued by their contributions to not only physical, but also social and emotional health. With more scientific evidence confirming the importance of sleep and managing stress, consumers will demand and expect an environment that delivers more than just a treadmill in a fitness center.
The sharing economy is chipping away at the divide between public and private space, requiring tomorrow’s apartment communities to be more integrated into the fabric of the community at large. Future residents will be more comfortable with the concept of “collaborative consumption” as the generation that grew up only knowing the sharing economy resets expectations about shared spaces.
We are already seeing other real estate classes — office, hospitality, retail and restaurants — evolve with these broader changes, so it would be a mistake to think we’re exempt from this disruption. The apartment industry must begin thinking about how to adapt to these sifts or risk facing a disconnect with their future customers.