Homeownership declined in the first quarter of 2011 to 66.4 percent. We’re now at the lowest level since 1998. And while single-family home construction is down 22 percent, builders have increased work on multi-unit complexes by 21 percent above last year’s figures.
Why should marketers care? Because we could be witnessing one of the most drastic consumer lifestyle shifts in several generations.
Under the assumption that many will continue to wait out the economy before jumping back into the housing market, the question becomes how long will they wait and will they wait long enough that a new segment of adult renters emerge?
Take those in their ’40s who sold or faced foreclosure, possibly due to a job loss. At what point will they feel both their employment and the housing market are stable enough to reinvest … and, by that time, will it give them adequate equity before retirement?
Should we continue to see growth in the rental segment, marketers may be looking at the emergence of a strong new demographic. Home-improvement industry aside, would this group of older renters invest differently, spend fluid assets more readily, or feel less hesitant to relocate and reject the concept of roots?
This may be the most important — and lasting — legacy of the economic crisis. Smart marketers would be well served to closely monitor this trend when reviewing their own consumer profiles.