Merging Demographics - Millennials and Baby Boomers Shaping the Housing Market



Mixed-use, multifamily development proposed by Sawtooth Development Group on Main between Grove and 10^th Streets, Boise, Idaho

Multifamily is the Hot News in Downtown Boise

As the economy picks up, money is coming back into development and construction, including multi-family.  New projects are getting launched, delayed projects are getting a second shot, and several developments are in the works in downtown and its periphery:

10^th and Grove – New construction with condominiums over parking [CSHQA]

10^th and Main (former Alden Building) – Four-floor redevelopment into mixed-use [CSHQA]

CC Anderson Building – Urban mixed-use / apartments with amenities attractive to Millennials [CSHQA]

9^th and River – Proposed CCDC multi-family development

The Depot Lofts – New apartments overlooking Capitol Blvd entry into the City / under construction

The Owyhee Plaza – Renovation of an aging hotel into dynamic mixed-use / under construction

What’s driving this growth?

Two of the largest demographic groups in the nation’s history are the bookends to the current market for housing:  Millennials, born after 1980, and Baby Boomers, born from 1946 to about 1964.  One might think the housing preferences of these groups would be quite different, but in fact they are merging in several areas.

A 2013 survey conducted by the National Association of Realtors found that an ever growing number of Americans want to live in neighborhoods that are walkable and contain a mix of uses such as shops and restaurants – AND they are willing to pay a premium to do so, plus trade down the size of their house and yard. 

Millennials are choosing neighborhoods that are more urban and dense than those they likely grew up in.  Eighty-million Millennials account for over 35% of the US workforce.  Most are not financially ready or able to buy a single family home and are postponing purchasing in favor of renting.  This allows them mobility and flexibility to adapt to changing circumstances as they finish their education and start their working lives. 

 

The ‘city as living room’ is key to many Millennials’ housing choices.  The nearby coffee house, bookstore or park are their community living rooms.  Developers in some cities are seeing a profitable niche in tiny units, which can command higher prices per square foot than conventional studio apartments, especially if they come with amenities aimed at tech-savvy 20-somethings.  Millennials are proving willing to accept small and micro-living units in exchange for immediate access to transit lines, grocery stores, parking for cars and bikes, fitness centers, garden plots and even dog and cat wash areas!

Sustainability is a significant value for people of all ages, and particularly for Millennials who were raised with an awareness of global climate change and stewardship of our planet.  Contemporary architecture, large windows, high-performance mechanical systems, thermal barriers and energy efficient appliances are part of the package.

At the same time, Boomers nearing retirement are looking to downsize and be nearer to services, shopping and healthcare.  Ten-thousand baby boomers turn 65 every day.  Their preferences include:

•        Single-level living, from patio homes to high rises with universal design principles that accommodate future needs and physical limitations

•        A house that’s not too big

•        Energy-efficient and low-maintenance homes that lower their monthly costs and fix-it chores

•        Healthy indoor air

•        Convenience and walkability, privacy from neighbors, and travel by car

Cities are also interested in multi-family development.  Excerpts from the DRAFT Boise Multi-Family Development Standards:

•        Parcels adjacent to an arterial roadway with existing or planned transit service shall be eligible for higher maximum densities by Conditional Use Permit.

•        Parking credits and reductions for multi-family development may be granted for the following project types and amenities:  Transit-Supportive Development, Vertical Mixed-Use Development, Affordable Housing, Podium or Structured Parking, Enclosed and Secure Bicycle Parking.

•        The minimum parking required shall be reduced by ten percent if fully enclosed, covered, secure bicycle parking is provided that exceeds the requirements.

 

This mix of projects in the works, plus new projects yet to be launched, will draw many new residents into downtown Boise, adding to the energy and vibrancy of our city.  –