Millennials have changed the rental market in unexpected ways. There is no doubt that millennials are looking for very different things in the rental market than other generations. Millennials are choosing homes based on flexibility, functionality, and even sustainability and often go for renting over homeownership. Nowhere is that truer than in Tampa. The housing market is growing more volatile. Renting provides safety, while a home purchase at the wrong time could be devastating if the market bubble bursts.
Function Over Size
A key difference in millennial renters versus older generations is in the desired amount of square footage. Millennials will rent larger spaces if need be. But they are also happy with smaller homes if the home meets other important needs. Millennials will prefer to rent a home with services like cleaning over a larger home with no included perks.
In fact, studios and smaller units are popular with millennials, especially if they are centrally located. A downtown unit might seem cramped for a couple but save them the commute in and out of the city every day to work. The focus has shifted to features that provide quality of life enhancements rather than an investment in home equity. Most millennials remember the housing bubble that preceded the Great Recession of the late 2000s and are still leery.
A Cautionary Tale
With the trauma of the Great Recession and a mobile job market, millennials look to renting in Tampa as a safe compromise. Many millennials are tired of struggling to achieve a work-life balance, and cities like Tampa appear to offer a shot at this ideal. But it is not only a matter of injecting fun and perks into life. Many homeowners insurance companies offer renters insurance. Millennials are purchasing these policies to protect their households. These policies give peace of mind at a low cost.
Flexibility Over Permanence
While the sense of ownership is appealing to many, a large segment of millennials is less concerned with property ownership. It is not as important to them to settle in one place. Flexibility has become more valuable. The housing market nationwide is white-hot and getting hotter, and Tampa is no exception. But millennials are still flocking to Tampa in droves—to rent.
For millennials, a mortgage feels like a heavy weight. Shorter leases allow them to travel. They may go to the beaches for a weekend getaway or overseas for extended vacations or international work opportunities. And as a generation, millennials are marrying and starting families later in life. This means many do not feel any pressing need to invest in a larger home. They prefer smaller apartments in neighborhoods with similar neighbors and interests.
The Value of Perks
Some of the perks of a living space are not the fun destinations but the lack of chores and responsibility. Millennials would rather forego ownership if it means they do not have to be responsible for yard work or other time-consuming upkeep. Millennials feel more and more pressed for their own personal time. The idea of dedicating their off-hours to cleaning out the gutters is not appealing.
Affordability Without Commitment
As housing costs skyrocket, millennials are leaving the most expensive cities like Miami and heading to the Tampa area. They can get the compromise of tons of perks with a lower cost of living. But it is not only the perks and the lower cost of living pushing growth in Tampa. More and more businesses are moving into Florida for the more relaxed regulations and lower taxes. Businesses are bringing their employees along. And the ones most likely to be comfortable with changing up their lives are the millennials.
Flexibility allows people to pick up and move with a business, and the same flexibility prompts them to choose a rental over a home purchase. Additionally, when businesses move and many employees choose not to follow, that opens up positions for job seekers. Young professionals prefer not to commit to a home for a company with which they have only just started.
Millennials Will Continue to Drive Growth
As the housing market frenzy increases, many millennials are warily watching. Renting feels safer and also offers a lot of perks and flexibility. They do not feel the value of homeownership overrides those perks. Millennials are starting families later—or not at all. So, the idea of investing in a home and potentially passing it down to their children does not feel relevant. Tampa offers millennials a valuable mix of experiences, lower costs, and proximity to a wide variety of job opportunities.