There are 47.5 million rental units in the United States giving property managers a large pool of applicants to choose from. Property managers have to constantly keep up with new marketing tactics on how to best attract customers. It is important to know which type of renters are out there, what their likes and dislikes are and in the end, who will keep renting. RealPagecompleted a study that examined 5.7 million individual lease transactions to find actual renter characteristics such as age, income, adults per household, marital status, and the presence of children or pets in the unit. The results show there are eight distinct types of renters.
1. Starting Out Singles – 29%
2. Young Adult Roommates -21%
3. Perma-Renters -16%
4. Middle-Income Boomers -11%
5. Moving on Up -8%
6. Working Families -6%
7. Young Couples -5%
8. Pet People -4%
The largest group of renters are the starting out singles. These are young adults, mostly around 26 years old with limited incomes and high rent-to-income ratios. Typically, these renters move around a lot as they are just starting their careers and finding their roots. A close second are the young adult roommates. These renters are typically around 28 years old and live with two or more adults. This particular group of renters has the shortest length of stay among all groups. When advertising to these two groups of renters it is important to note that they are young and like amenities and luxury, also both renter types move around a lot so keep that in mind when the end of their lease is approaching.
One of the most overlooked groups of renters is the perma-renter. Perma-renters are typically in their early 40’s and always renew their lease, at least once. This group of renter does not like to move around, making them an ideal tenant. Along with the perma-renter, middle-income boomers also are more likely to renew their expiring leases. Around 62 years old, middle-income boomers tend to reside in areas with slow-growth economies and retirement hubs.
The smallest groups of renters are the moving on ups, working families, young couples, and pet people. These groups comprise of people in their 30s. Moving on up renters are in their early 30s who want upscale properties. Working families tend to opt for single-family rental homes rather than apartments and are in their mid-30s. Young couples are in their mid-to-late 30s and are more affluent than the younger renters. They are comprised of two adult households and are almost always married. The young couples also prefer new upscale properties. Finally, the smallest group of renters are pet people who are in their early 30s and are living in the mix of one and two adult households.
As a property manager it is important to know what type of renter your building attracts and how to best suit them. If you lean towards the starting out singles or young adult roommates, it is important to have a strategy for gaining new residents or creating a space where they would want to renew the lease. In addition, one can adjust their marketing plans to appeal to their target audience and then in return develop retention programs to keep them renting. No matter what type of renter your units attract, it is important to be informed on who they are, what they want, and how long they are likely to stay.