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You can imagine young tenants frolicking around the apartment pool or enjoying Super Bowl Sunday in the community lounge. But chances are those renters are living in a house: 39% of renters live in single-family homes, according to the US Census Bureau.
The number of single-family homes available for rent increased 32% between 2006 and 2013, according to CoreLogic, a provider of consumer and real estate data. At the same time, the supply of apartments in many markets has tightened. Nationally, the vacancy rate was 4.4% at the end of 2015, according to Reis, a market data provider.
“Our customers who are in their 20s and 20s primarily want apartments,” says Jonathan Eppers, CEO of RadPad in Los Angeles, a rental and payment site. “We find that people looking for a single-family home rental are typically in their 30s, married or getting married, and planning to start a family.”
Fannie Mae research shows that in 2013, 52.4% of renters between the ages of 25 and 34 lived in single-family homes, compared to 43.4% in apartments.
What tenants want
RadPad’s recent research into what their mostly millennial users want shows that the most sought-after amenity is parking, followed by an in-unit or on-site washer and dryer.
Advantages of the apartment / disadvantages of the single-family house
The decision of apartment or house always comes down to individual preference, but Brandon Brittingham, regional manager of Long & Foster Real Estate in Salisbury, Maryland, says he finds younger renters and retirees prefer an apartment in order to avoid maintenance tasks. Apartments generally offer tenants more amenities than single-family homes.
A big amenity that apartments offer more often than single-family homes is a location in a city or close suburb, providing a walkable lifestyle that appeals to young renters and empty-nesters alike.
“Tenants want a convenient lifestyle close to cafes, restaurants and public transportation,” Eppers says. “It’s easier to find in an apartment in the city than in a suburban single-family home.
“Anecdotally, we find that apartment renters value convenience and flexibility above all else and are willing to pay more to be in a smaller unit in the right neighborhood rather than having more space in a neighborhood. less sought after,” says Eppers.
Apartments and single-family homes can have professional management, which makes it easier for tenants to maintain, but some single-family homes have less experienced landlords who can be harder to reach, says Aaron Marshall, CEO of Keyrenter Property Management in Salt Lake. City and Midvale, Utah.
Advantages of the single-family house / disadvantages of the apartment
The Urban Land Institute asked 259 millennials why they chose to rent single-family homes. Their main reasons:
- 45% cite “more confidentiality”.
- 41% say they like having a garden.
- 31% say they get more interior space for the money.
- 31% appreciate the extra storage space.
- 25% like having a garage.
“The biggest benefit of a single-family home is privacy,” says Brittingham. “Most of the tenants we work with decide that as long as the rent is comparable, they’ll choose a single-family home because they can get more space and a bigger yard, which is especially important if they have kids.”
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Brittingham also says people like not having neighbors directly above or below them.
“People like to stay longer in a single-family home because they have less noise issues from neighbors or neighbors’ dogs,” says Marshall. “You also don’t have to deal with smokers in the adjacent apartment or outside your window.”
Marshall says rents tend to rise more slowly for single-family homes than for apartments.
“Apartments also have a higher cost per square foot in some places,” says Brittingham.
Marshall says that in his area, you can often get an extra garage, yard, and bedroom and bathroom in a single-family home compared to a similarly priced apartment.
Parking, the #1 priority for renters, according to RadPad, is usually available either on the street or in a driveway or garage with single-family homes, but not all apartment buildings offer parking, said Marshall.
Whether you prefer an apartment or a single-family home, make sure you know the rules about pets and who pays the charges before signing a lease. Rules vary from rental to rental. Once you have made a price comparison based on this information, you can rely on your personal preferences for privacy or co-living.
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