2020 Rental Property Market Trends
Like the weather, the rental forecast is constantly changing, and staying ahead of the curve means always being in the ‘know-now.’ So, what’s going on with rental marketing trends in 2020 and what should you expect? Renters are changing, Gen Z is in the market, technology is being pushed, rent growth is stabilizing – there’s a lot you should be prepared for. Keep reading to learn about 2020’s rental market trends and how they will affect you. Call LBPM, Los Angeles Property Management at 818.918.3967 for more information about renting within the area and how the following trends will affect you.
Rental Market Trend #1. Gen Z Is In The Market
Millennials once ruled the rental market, but with mortgages at a low, many are beginning to buy their first homes. Gen Z is taking over the market – aged early to mid-’20s and reliant on technology. For renters, marketing and leasing efforts should focus a lot on incorporating tech into efforts. Trends for marketing towards Gen Z renters will include a less formal talk and more casual social media messaging, as well as taking more of a relaxed approach and utilizing apps and tech more often.
How The Gen-Z Impacting The Rental Market
When trying to secure the ideal Generation Z tenant, keep the following in mind to stay relevant and competitive in your own niche!
- Competitive Pricing
- Demand For Quality Photos + Virtual Tours
- Increased Digital Marketing + Online Presence
Rental Market Trend #2. Growing Use Of Technology
The modern world focuses so much on technology and amenities will greatly expand in 2020. The rental industry is no exception. In 2020, expect tech solutions for almost every aspect of Los Angeles property management. For example, this marketing trend will make many things easier such as landlord communication, climate control, online rental payments, etc. Many renters will also be on the lookout for luxuries such as high tech gyms, free wifi, and keyless door entry. These trends can help build revenue and they should be offered for free or as a monthly subscription service.
Rental Market Trend #3. The Expectations Of High-Quality Property Management
This trend is absolutely huge and should be adhered to all across the board. For renters, the quality of property management is equally as important as the actual unit that is being rented. Improving a resident’s experience is extremely cost-effective because it gives renters the ability to retain and attract more renters – it’s as simple as that. Keeping good credibility and high online rankings will keep renters coming through your door. Keep in mind, a 3.5-star rating or lower will probably turn away prospective renters.
Rental Market Trend #4. Rent Control May Rapidly Spread
Rent control limits the price that a property owner can charge a tenant to live in an apartment, in order to ensure that lower and middle-class residents can afford a place to live. This government regulation has hit many states including New York, California, and Oregon, and the trend may follow suit to your state next, especially if it’s an expensive renting state. This trend has many investors worried because it would freeze investments nationwide and property owners may not be able to recoup costs or be able to reinvest in upgrades and maintenance. More than likely, high-cost housing states will follow this trend in 2020 and for years to come.
“In Los Angeles County, the cities of Santa Monica, West Hollywood, Beverly Hills, Culver City, Inglewood, the city of Los Angeles, and unincorporated neighborhoods of Los Angeles County have local rent control laws.”
Rental Market Trend #5. Sustainable And Stable Rental Growth
Since mortgages are at an all-time low and more people are buying their first homes, you can expect rent growth not to increase too much. In fact, since June of 2019, rent appreciation is at a rise of only 2.3% and the growth will actually taper around the spring of 2020. Inflation and wage growth are both leveling out, so renters should expect a generalized happy market of potential tenants.
» Final Thoughts
In 2020, a lot is on the plate for both renters as well as potential tenants. With Gen Z in the market, as well as mortgages, being low, many trends are different than they were in 2018 and 2019. Renting used to be somewhat of a ‘right of passage’ for younger people, but now it’s a lifestyle choice for people of every age. Therefore, renters need to adopt a mindset that fits everyone’s needs. Fitting a broader demographic with good rental prices should be the goal that everyone is looking for in 2020.
You can always speak directly to one of LBPM’s property management specialists about these trends and if they will apply to you by calling 818.918.3967.