To paraphrase an old magazine ad, “What Becomes a Gen Z Most?”
Even though the ad itself predates most Gen Zs, it’s significant to us today because the cohort (to use an uncomfortable phrase sociologists apparently love) very much deserves property managers’ collective attention.
Many folks born after 1996 are now entering the workforce, which means they’re also in the market for their first home. According to Pew Research, one in 10 eligible voters last year was a Gen Z.
As IREM reported in a recent blog, this generation also has its eye on eventual homeownership. “Ninety-seven percent of Generation Z plan to buy a home in the future,” we wrote. For property managers, this means that, in the coming years, tenants will opt for more affordable (yet functional) homes that will allow them to maximize their savings.
But, whether it’s an apartment or a house, what amenities will attract a first-time renter or buyer? What does functionality mean? Not at all surprisingly, unlike baby boomers, since Gen Z are digital natives, high-speed internet access is their most sought-after amenity.
According to Construction Executive: “The new renter generation, Generation Z, grew up with a technology and culturally diverse background—and is becoming one of the most significant age groups of renters in the housing market. Embracing technology and social media, these young adults are most on the lookout for top-notch, affordable apartments.”
Quoting a recent RentCafé survey, the online magazine reports that, while Gen Z wants to keep a tight rein on its rental purse strings, 62 percent also want technology-enabled features, especially (for 27 percent) that high-speed internet access. In fact, survey respondents put that above extra bedroom space or fitness centers.
Of course, “technology-enabled” covers a lot of ground, and included in the list are such management-facing availabilities as mobile apps for managing rent and maintenance, text rent payments and “smart locks, thermostats and energy-efficient appliances in their apartments.”
We should note here that the pandemic did put a damper on a lot of the rental plans for this generation. Pew Research states that fully half of older Gen Zs or someone in their household lost a job or took a pay cut directly because of COVID-19. “This was significantly higher than the shares of millennials (40 percent), Gen Xers (36 percent) and baby boomers (25 percent) who said the same.”
How the generation searches for their apartments is also significant to property managers. When they are up and home-hunting again, their first stop (for 39 percent, according to RentCafé) is Google. They then filter their searches by scouting photos and reading online reviews before they ever reach out to a listing agent. In-person tours are still a must, however, after the web work is done, and 72 percent say they need to physically kick the tires.
However, this focus on technolgy should not be misread as a disinterest in style. On one hand, according to RentCafé, more than any other cohort, Gen Z wants affordability. On the other hand, they will not give up quality and are the most willing age group to buddy up with a roommate to afford the apartment they want.
Property managers on top of their game are always adjusting to the wants and needs of their renters. As generations change, so do tastes, styles and tech accessibility. If this were not true, we’d all still be listening to 45-rpm records and watching black-and-white TVs.
Gen Z is checking specific boxes in their apartment wish list. Understanding those wants and needs only positions forward-thinking property managers for the up-and-coming generation.
Chip Watts is the 2021 president of the Institute of Real Estate Management. In addition, he serves as president and executive CPM for Watts Realty Co. Inc., in Birmingham, Ala.