There’s no denying that the rental market is hot. Since 2006, the number of Americans living in rental properties has soared to nearly 37%, the largest amount since 1965 and developers tapping into the segment’s opportunities are thriving.
However, access to single-family homes, although not a new issue, is at the forefront of conversation while rental homes in single-family-for-rent communities provide far less barrier of entry. Whether you prefer to call them Build-to-Rent or B2R, or single-family-for-rent, abbreviated SFR, these new communities are taking precedence in the rental sector because they offer the sought-after benefits of privacy and security of a single-family home with the added amenities and ease of rentership.
The knowledgeable design teams at HPA Design Group are ready to meet the SFR demand with over 20 years of experience of designing and collaborating with large and small developers across the nation, keeping an eye out for emerging trends, and mindful of changing demographics.
Tenants of SFR developments span professional millennials, move-up families or life transitions, like divorce, and empty-nesters. Most renters are younger households tired of apartments but not ready or able to buy a home. There is also a significant demand from Boomer households who are downsizing from owned single family but not seeking typical apartment life.
Growth in the 35+ population is now greater than the growth in the 25-34 age group and they are starting to have kids, which is driving some sudden shifts in housing demand. Rental homes and townhomes appeal to many older Millennials who have children because they tend to prefer a yard and more interior space.
Millennials are having children ten years later than generations before them, but they are having them. And that is influencing the kinds of rental housing they seek. And the lock-and-leave convenience of renting is appealing to all generational groups, particularly the Baby Boomers whose kids have left the nest.
From spa-like master baths to oversized, chef-inspired kitchens and coveted outdoor spaces, HPAD’s Senior Project Manager, Niki Landry highlights crucial lifestyle and design trends and what renters want in a SFR home.
Less is More: According to Pew Research Center, smaller families have been trending since the 1970s and that doesn’t show any sign of stopping. Instead of a home in the suburbs with enough space for a growing family, this crowd prefers modest one- and two-bedroom homes or townhomes in a more urban setting.
The need for less is also attractive to empty-nesters. Since their children have left, they are less focused on good schools and moving to communities that fit their amenity desires, to be near the grandkids or even closer to the coast.
Move over, Modern: At the intersection of accessible and comfortable, yet still reminiscent of modern design, is where the transitional aesthetic exists. It’s defined as a contemporary style mixing traditional and modern styles, incorporating old world traditional and the world of chrome and glass contemporary. It appeals to a wide range of demographics and marketable for developers.
“This style is growing in more suburban markets so they are leaning more transitional and less modern,” recalls Landry. “Clients want the residents to feel that these spaces can be cozy and personal.”
Since the demographic is targeting families, pet owners, and a market that would traditionally be home-owners, it provides the opportunity for the single-family home comfort with the convenience and community of multifamily.
Outdoor is the new Indoor: One of the perks of renting is the lack of yard maintenance. Across all demographics, SFR tenants seek more privatized outdoor space to lounge without the neighbors lurking. This trend can be achieved by positioning the architecture around the outdoor space or by meshing the architecture with the outdoors, allowing more space in the home to be exposed to the outdoors.
Another outdoor trend is covered rooms or porches. Outdoor retreats with space to entertain or interact while being sheltered from the elements is ideal, especially in markets with extreme weather like Florida, Texas or Arizona. Adding a stone fireplace or outdoor kitchen and grilling island enhances the experience.
Or, if adding a covered outdoor space isn’t an option, the use of large floor to ceiling windows and sliding doors can also serve as better indoor/outdoor connectivity.
Make it Your Own: SFR residents are looking to find feature elements that reflect their personal tastes and preferences, from kitchen products and bath fixtures to custom flooring and even the overall layout of the home.
“A must-have for personalization are booths and nooks” says Landry. “They’re a great way to have a customized feel and aesthetic of furniture in piece that’s more commonly a fixture with strategic colors and textures that won’t make a space feel smaller.”
Another added touch are built-in bookshelves, where residents can decorate and personalize to match their distinct taste and style.
Gourmet Expectations: Before making the decision to sign a lease, many renters consider multiple factors – most importantly location, but also community amenity offerings and interior unit amenities. When it comes to certain unit amenities, many are willing to go above average rental rates to get what they want.
The pandemic inspired people to escape old backing habits and seek out new culinary crafts, which means the sourdough obsessions of yesterday could potentially morph into soufflé mania tomorrow. More residents are valuing a well-equipped kitchen than before due to safe social distancing practices, so they’ll require more space to entertain and delight guests with new culinary skills in the upcoming years.
These requirements include reach-in or walk-in pantries, bigger cabinets, kitchen islands, designer fixtures and faucets, and upgraded appliances. The kitchen is a major focal point for SFR tenants, so this space can potentially make or break a lease.
Pet Perks: Pet owners can account for anywhere from 20 to 90 percent of a multifamily community’s residents and the appeal of on-site pet amenities is on the rise. From agility courses and bark parks, to grooming and bathing rooms, renters want access to these exclusive areas.
The benefits and value-add potential include but not limited to attracting a larger pool of residents, increased resident retention due to higher satisfaction, and additional income from higher rent, pet fees, or add-on services. Renters know they need to pay extra each month for these services and are more willing to do so when that means they get to live with their beloved dog or cat.
The Home Office: Due to the rise of COVID and more companies switching to flex schedules, having a home office is vital to the new way of working. Not only is the amount space in a home important, but also creating a space that fosters productivity, focus, functionality, and learning capabilities.
Designing a diverse unit mix that allows for two bed/one bath or one-plus-den layouts may become in demand as new communities are planned. The extra room could not only double as a dedicated home office, but a guest room or nursery and contain an optional closet build-out that has space for a printer and office supplies.
Tech Savvy. New advances in technology create a need for a new lifestyle at home, which usually revolves around the use of hand-held electronic devices. Nearly 77 percent of renters say they want a place with technological innovations and would love to brag about smart automation.
“Having a family room that supports two laptops and an iPad notebook and multiple smartphones is ideal,” Landry states. “Designing more electric plug capability to accommodate recharging needs is crucial as are master bedrooms that can support a flat-screen TV.”
Aside from the practical reasons behind choosing a smaller home, there’s something bigger at work — the changing mindset of Americans. After almost 50 years of a community standard driven by consumption, the tide is turning away from filling your big home with things and more toward practical, liveable spaces.
Millennials and Gen Xers are focused not only on saving money, time and energy, but also on more mindful consumption and reducing their carbon footprint.
Only time will tell how long this single family for rent trend sticks, but one thing is for sure: The American dream of owning a home lives on, however it’s taking on a different face, as residents are increasingly thinking smaller, less maintenance, and more peace of mind.