This month, my parents downsized from their 4-bedroom home of over 43 years, moving into a 2-bedroom Midtown Green apartment. While unique in their own rights, my parents are not unique in their recent move. According to a recent study commissioned by the National Multifamily Housing Council (NMHC) and the National Apartment Association (NAA), 4.6 million new apartment units will be needed by 2030, in part, because people over 65 years in age are downsizing from owner-occupied houses to apartments in large numbers. The substantial increase in international immigration and the millennials’ delayed home buying are also contributing to the substantial increase in apartment demand.
While the increase in apartment demand is nationwide, this trend will be most significant in fast growing metropolitan areas such as Raleigh, Charlotte and Atlanta. Demand for apartments in Raleigh is such that an increase of more than 69% in new apartment units will be required by 2030. Land use regulation-wise, Raleigh is well positioned to accommodate this trend with the recent adoption of a new Comprehensive Plan and Unified Development Ordinance, both of which lay a strong foundation for higher densities in the fast growing capital city. But is it enough? The study reports that, from 2011 to 2016, an average of 2,356 apartment units were built annually in Raleigh; however, to meet the projected demand, the amount of new apartment units built per year needs to grow to 5,309. This amount represents a more than 125% increase in apartment unit construction per year. Time will tell if the political will of Raleigh’s citizens will rise to the challenge.
Side Bar: Enter the furniture dilemma. The aging population downsizing coupled with the delayed home buying of millennials is presenting challenges for these families in transition. What do you do with all of the furniture that decorated the vacated houses? Take my extended family for example. Of my parents (Silent Generation), my three adult children (Millennials), and my wife and I (Baby-Boomers), my wife and I are the only ones living in an owner-occupied house. The others are all apartment dwellers. The result of these families in transition, like mine, is that the Baby-Boomers (or thrift shops) end up housing most of the furniture (their parents’ and their children’s). Read the Washington Post 2015 article “Stuff it: Millennials Nix Parents’ Treasures” and BuzzFeed News’ online article “How One generation changed the Way We Think About Furniture” for more insight on the furniture dilemma.
For more information about these real estate trends or about the entitlement process for new apartment developments, contact David York at 919-755-8749 or visit http://www.smithmoorelaw.com/york_david.