Thursday , 24 May 2018
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Report: Houston Must Add 214,000 New Apartments by 2030

Rick Haughey, NMHC

HOUSTON – (By Dale King, Realty News Report) – “We live in an age of disruption, and the multifamily industry, historically slow to adapt to change, is especially at risk.”

A newly released report from the National Multifamily Housing Council (NMHC) offers that grim assessment of the herculean task facing the apartment industry.

The council’s research says 4.6 million new rental units must be created nationwide by 2030 to meet anticipated mounting demand.

The massive report, broken down by areas, metros and districts, says Houston must add 214,000 rental housing units in the next 12 years, not only to handle soaring population growth, but to deal with an increased propensity to rent.

“The multifamily industry needs to catch up with the revolutions that are already well underway in everything from transportation and retail to demographics and psychographics,” said Rick Haughey, NMHC’s vice president for Industry Technology Initiatives.

“With a population that is aging and growing more diverse, which is impacting household composition, now is the time for our industry to adapt and build to meet the needs of the future.”

The NMHC just released a massive amount of information in its 2018 Consumer Housing Insights Survey, along with an in-depth trends document called “Disruption: How Demographics, Psychographics and Technology are Bringing Multifamily to the Brink of a Design Revolution.”

The report, available on line, includes visualizations of how the industry could respond to the coming waves of disruption, which the council brings to life with a series of computer-generated videos done in partnership with KTGY Architecture + Planning.

Research and renderings underscore the requirement that developers, investors, property managers and architects adapt to the renter population’s shifting demographics, desires and psychographics (the study and classification of people according to their attitudes, aspirations, and other psychological criteria). Only in this way, the report says, can the industry effectively reach annual apartment construction figures unlike anything seen in previous years.

The report says the United States will have to build an average of 324,000 new apartment homes each year to keep up with demand. The industry averaged just 225,000 completions annually from 2011-2016.

Several conditions disrupt these scenarios. Consumer tastes will change over the next 12 years. The population mix will also modify with the aging of baby boomers, the growth and maturation of millennials and the addition of immigrants.

Not every segment of the nation will change in the same way at the same time. And different areas have different zoning, planning, construction rules and other regulations that can either improve or hinder apartment growth.

The report spells out that Houston currently has a population of 1.3 million apartment dwellers living in 552,000 residences. That group contributes $22.6 billion to the economy and supports 218,700 jobs.

Overall, says the report, Texas has 3.8 million apartment residents in about two million units. They contribute $76.2 billion to the economy and support 722,600 jobs.

Augmenting the multifamily muddle is the determination from the 2018 Consumer Housing Insights Survey that consumers are demanding flexible living spaces, personalization, healthy living features and amenities, convenience and connectivity in apartment homes.

When it comes to personalization and flexibility, respondents noted that adaptation is key. In fact, 83% of them believe it is important to have a space that evolves with different stages of life while 78% believe it is important to have a space that can transform to meet different needs.

NMHC researchers surveyed 1,000 adults with emphasis on renters and millennials. Findings include the following:

  • Americans have difficulty describing the “apartment of the future.” Instead, they advocate for improvements to current services and amenities.
  • Technology, in the form of strong cell service or fast internet access, is a requirement for modern apartments or any housing arrangement.
  • Americans want more amenities at their fingertips: Better appliances and washer/dryers as well as community features such as outdoor spaces and gyms.
  • Millennials are more likely than older Americans to see rental apartments as “innovative,” to call for a broader community role for apartments and agree that “my community is stronger when there is a mix of rental apartments and single-family homes.”
  • Millennials are more social and more attached to urban centers. They are more likely to listen to live music, but also value face-to-face communication.
  • Nearly two-thirds (63%) agreed that their lives were so hectic that they look for ways to make things easier.
  • 94% said that being able to personalize their space is important.
  • 40% percent of respondents said they plan to telecommute more in the future
  • 60% said their home is a reflection of their identity.

To illustrate the major shifts predicted in the multifamily industry and to help developers, property managers, investors and architects envision the apartment of tomorrow, NMHC partnered with KTGY Architecture + Planning to develop eight videos that showcase futuristic living spaces.

Features such as moveable walls, interactive fitness and wellness amenities and 3D printers are some highlights of these futuristic spaces. Videos and renderings, as well as the full ‘Disruption’ report, can be viewed at http://nmhc.org/disruption.

Jan. 24, 2018 Realty News Report Copyright 2018

 

 

 

 

 

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