Residential Real Estate Trends

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Insights and Trends - Residential Real Estate Market: United States

Three current trends in the U.S. residential real estate market in large cities are Millennials leaving downtowns for surrounding areas, rising home prices, and single-family rental homes.

Three Current Trends in the U.S. Residential Real Estate Market in Large Cities

1. Millennials Leaving Cities for Surrounding Areas

  • Though big cities have been a magnet for Millennials, this generation is currently exiting big cities and choosing to live in nearby areas outside of the city.
  • In 2018, industry source RentCafe "ranked zip codes in the 30 biggest U.S. cities by the highest increases in millennial population." Of the zip codes that ranked in the top 20, just four were downtown areas. All the other zip codes were near downtown areas or surrounding neighborhoods outside of those big cities.
  • The aforementioned study also found that of the "top 20 zip codes with the largest millennial population," none were downtown areas. Rather, they were either near-downtown areas or surrounding neighborhoods outside of those big cities. As an example, though New York accounts for nine of those "top 20 zip codes," none of the nine were located in Manhattan (but rather were mainly Queens and Brooklyn).
  • In 2018, "[l]arge U.S. cities lost tens of thousands of millennial and younger Gen X residents" per Census data. According to the Wall Stret Journal, most of those leaving big cities in the U.S. relocate to either "nearby suburbs or the suburbs of other metro areas."
  • The Wall Street Journal reported that 2018 marked "the fourth consecutive year that big cities saw this population of young adults [ages 25-39] shrink." Cities that lost a substantial quantity of people in that age bracket included Chicago, New York City, and San Francisco, among others.
  • In 2018, the number of people between the ages of 25 and 39 that New York City lost totaled nearly 38,000. That exodus was approximately twice as many that the city "experienced each of the previous three years."
  • This is a trend because it has been expressly described as such by numerous reputable sources, including the Wall Street Journal and CNBC, among others.
  • As was previously stated above, major cities where this trend has been readily apparent include Chicago, New York City, and San Francisco.
  • The main factors driving this trend are the quality of schools and expensive housing costs.
  • Millennials are also increasingly becoming homeowners, which is yet another factor contributing to this trend.

2. Rising Home Prices

  • The rising prices of homes is another current trend in the U.S. residential real estate market in large cities.
  • In 2019, housing prices rose by 3.7%.
  • Per research from Standard and Poor's, housing prices increased in 2018 in "all 20 major U.S. cities."
  • For 2019, housing prices were projected to increase by 4.3%, nearly keeping pace with 2018's increase rate of 4.8%.
  • Housing prices are expected to continue increasing in 2020, as CoreLogic's Home Price Index Forecast projects that come May 2020, home prices will increase by 5.6%. Another industry source also projects home prices to increase in 2020, albeit at a lower clip of 3.6%.
  • This is a trend because it has been expressly described as such by at least three, credible industry sources (Global Property Guide, Mashvisor, and Kiplinger).
  • This trend is illustrated in the major U.S. cities of Atlanta, Boston, Los Angeles, Chicago, and New York, which saw home prices increase in 2018 by 6.2%, 5.59%, 4.44%, 3.11%, and 3.5% respectively.
  • Factors driving this trend include "the shortage of affordable homes in the U.S." which has resulted, in part, from builders' focus on more-upscale housing developments.

3. Single-Family Rental Homes

  • Single-family rental homes is a popular trend in large U.S. cities.
  • According to industry source Roofstock, "[i]n the top 20 largest markets, SFR [single-family rental] makes up 15-30% of all single family homes and between 20-50% of all rental properties. SFR has grown tremendously and much of that has been driven by significant growth in the top markets."
  • While this is a current trend, it's equally a future trend. As one source stated, "[t]he rise of the single family rental asset is one of the hottest residential real estate trends that is showing no signs of slowing down." The number of single-family housing units in the U.S. currently totals approximately 16 million, which is projected to grow substantially by 2030 to a whopping 29 million.
  • Nearly half (45%) of the single-family homes being rented in the U.S. are owned by landlords who only possess one such unit.
  • Major U.S. cities where this trend is readily apparent include Chicago, Atlanta, Dallas, Denver, and Miami, among others.
  • Factor driving this trend are the lack of affordable housing available for sale and builders' focus on developing more-upscale housing due to expensive labor, materials, and land costs.

Research Strategy

To identify current trends in the U.S. residential real estate market in large cities, we reviewed articles about the state of the market published by reputable sources such as Forbes and the Wall Street Journal. We specifically focused on information specific to large markets in the U.S., as was requested. We ensured that each trend we included is indeed a trend by finding it expressly described as such by one or more additional, credible sources. To further demonstrate the pervasiveness of these trends within the U.S. residential real estate market in large cities, we included the supporting data we found throughout our research, which clearly demonstrates the magnitude of these trends. Lastly, all the trends we included are current trends, as was requested.
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Residential Property Managers - Concerns and Priorities: United States

Growth, efficiency, profitability, hiring and maintaining quality staff, and maintenance are some of the concerns and priorities of residential property managers in the United States, including those within the large markets.

Concerns and Priorities


A) Reason/Factor Responsible

B) Data/Statistics to Support

  • About 26% of U.S. residential property managers in large markets considered growth to be one of their top challenges and concerns in 2018. It was a slight increase from the 2017 survey (27%).
  • U.S. residential property managers are concerned with and prioritizing locating new clients, expanding their property portfolio, and business scaling.


A) Reason/Factor Responsible:

  • As listed in the Buildium and National Association of Residential Property Managers report, business scaling is one of the factors responsible for efficiency concerns since the past few years have been all about company growth.

B) Data/Statistics to Support:

  • Around 32% of residential property managers in the United States consider efficiency as one of their top challenges and concerns in 2018, which is the same last 2017.
  • U.S. residential property managers are concerned with and prioritizing efficient time management, processes, and tasks. Efficiency was the primary goal of 39% of property managers in 2018 in large markets.


A) Reason/Factor Responsible:

  • Factors such as an apparent shift in the client base of property managers from Accidental Landlords into investors, and "the need to find revenue sources other than property acquisitions in the current economy" are responsible profitability concerns and priorities.

B) Data/Statistics to Support:

  • U.S. residential property managers have increased their concentration on profitability by 10 points, from 26% in 2017 to 35% in 2018, by means such as selling "non-profitable, high-maintenance properties and only taking on more lucrative ones to replace them."

Hiring and Maintaining Quality Staff

A) Reason/Factor Responsible:

  • According to the Unicom survey report, "lack of quality candidates in the market and high demand" are some factors leading to apprehension over hiring and maintaining quality staff.

B) Data/Statistics to Support:

  • Less than one-third (23%) of U.S. residential property managers reported being focused on hiring, managing, training employees, and responding to turnover, specifically in large markets, in 2018.
  • At least 49% of U.S. residential property managers listed recruiting and retaining staff as "challenging" or "very challenging."


A) Reason/Factor Responsible

  • A reduction in reliable vendor options and increased demand in property management are some factors contributing to maintenance concerns by U.S. residential property managers, including in large markets.

B) Data/Statistics to Support:

  • According to the Unicom survey report, 25% of U.S. residential property managers listed unexpected maintenance and property damage as "challenging" or "very challenging."
  • Around 31% of U.S. residential property managers, including those in large markets, are prioritizing conducting inspections, handling maintenance requests, and performing repairs.
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Residential Tenants - Concerns and Priorities: United States

The insights surrounding what residential tenants in large markets within the US include affordability, a preference for rent-controlled units, a need for more multi-family units, and a desire for amenities.

Insights Into US Large Market Residential Tenants' Concerns


  • The need for affordable rental property is a central concern of residents in the larger markets (e.g., San Francisco, New York City, San Jose, and Boston) with the highest rents. The average cost for a one-bedroom property rose 1% ($1,250) while two-bedroom properties increased 0.5% ($1,493). The cost of both these property types has increased by 2.4% and 2.2%, respectively, year-over-year.
  • Additionally, rising home prices (e.g., a median price in the $200,000 range for a home in Ohio's metropolitan areas) are also driving the need for affordable rental property. There is a 59% margin between housing rentals and home purchases. Other factors influencing prices include low vacancy rates, rising incomes, high employment, reduced new construction, local building regulations, high construction costs, investor expectations on returns, younger renter demographics, and a lack of homes or condos to purchase at affordable prices.

Rent-Controlled Units

  • According to The Urban Institute's rental control report, tenants in rent-controlled units are less likely to move out. These rent-controlled units have been part of an effort by local and state governments to provide vulnerable tenants with rent stabilization without reducing the quantity or quality of the housing supply. However, officials have not widely adopted these policies outside of larger cities like New York; Los Angeles; San Francisco; Oakland; and Washington, DC.
  • That said, one study conducted in San Francisco found that rent-control limits renters' mobility by 20% but does reduce levels of displacement from the city. Additionally, rent-controlled units in New York City are slowly disappearing due to continuous occupancy requirements and vacancy controls; the city still has 966,000 rent-controlled units.

Multi-Family Units

  • According to the American Community Survey, the number of single-family rentals (including detached, attached, and mobile) has grown at a slower rate compared to multi-family units. Comparatively, the latter are in greater demand in the larger cities (i.e., areas of high job concentration). With most higher-income households located primarily in high-rise buildings found in central city areas, the need for multi-family units has dramatically increased.
  • As it happens, the more affordable rentals are in smaller, multi-family structures. One-quarter of low-cost units are in buildings with two to four apartments. Multi-family units account for 61% (28.9 million units) of the nation’s rental stock. Rentals in multi-family buildings (i.e., those with 5–19 apartments) are more likely to be moderate (e.g., $850–$1,099).


  • According to a survey from the National Apartment Association, amenities play a major role in tenants' preferences towards a property. The kinds of amenities renters have come to expect (by the strength of preference) include pet-friendly facilities (17%), fitness centers (13%), swimming pools (11%), common areas for socializing (10%), and outdoor kitchens (10%). To meet this need, property owners are increasing the number of amenities available on their properties while off-setting the costs through rent increases and higher occupancy rates.
  • However, renters are willing to pay premium rents for amenities that provide enhanced convenience. Data from J Turner Research indicate that residents are willing to pay $30 to $75 more per month for granite countertops, balconies, and hardwood floors along with higher average rent increases of $77 per unit compared to $52 for unit-specific upgraded amenities. In Boston, the average premium paid for added amenities is $80.15 (lounge), $66.93 (24-Hour fitness center), and $56.38 (roof deck).

Research Strategy

We began our investigation with inquiries into multiple rental and housing market research and survey reports from organizations like PwC, National Apartment Association, and We were able to locate key insights and data from these sources.