Multifamily Executive magazine just published a study that shows many new buildings include a large share of studios and one-bedroom apartments. That is sort of understandable, given that Millennials are a prime target. Having said that, if the developer is thinking condo conversion in the future, fuh-get-about-it. How many people in the near future are going to be paying $600 – $900 a square foot to live in a 450 square foot studio? Successful conversions in the past have almost always had a good distribution in the two bedroom/one bath or two bedroom/two bath range of 800 – 1,000 square feet, or so.
I love Millennials because they are going to buy a zillion homes from us in the coming decade. A recent Google Consumer Study revealed that 30 percent more Millennials (born 1980 – 1995) visited real estate websites in 2014 compared to the previous year. Also, twice as many are likely to plan a home purchase in the next year as compared to those between the ages of 35 – 54 years old. Before we all start spending the money we’re going to make, however, realize the challenges of selling to this age group. (1) They desire more than they can afford; (2) They take longer to close the deal; (3) They are unable to see past cosmetic updates.