THE NATIONAL MULTI HOUSING COUNCIL (NMHC) issued a statement refuting analyst claims that new federal and private-sector homeownership initiatives will automatically translate into meaningful losses for the apartment sector.
Mark Obrinsky, NMHC's chief economist, stated, "Housing demand is not a zero-sum game. Population growth--through natural population increase, continued high levels of immigration and increased life spans--will increase demand for both owner- and renter-occupied housing. While the recently announced homeownership initiatives may turn some renters into owners, the overall demand for rental housing should be on the rise for at least the next 15 years."
According to Obrinsky, the key factor driving housing demand in the next decade will be demographics. Many of those demographics trends will favor rental housing, he said--especially the swell of echo boomers (those currently between the ages of 8 and 27) and the continuing shift toward single-person households.
"After declining for two decades, the population in the prime renting years (age 20-29) is expected to increase 11 percent between now and 2010. Eventually, more than 80 million echo boomers will move into the housing market, most likely as renters first. And there is no 'baby bust' expected behind this generation, just a plateau," Obrinsky stated. "Then there are continuing changes in household composition. The households most likely to own--married couples with children--are declining in number and now account for less than one-quarter of all households. Meanwhile, two-thirds of all new households in the past decade were nonfamily households (including single-person households), which have the lowest homeownership rates. By itself, this demographic shift would cause the rentership rate to rise...