Demand for rental apartments is increasing thanks to the nation’s 80 million echo boomers, also known as generation Y (Gen Y) or millenials, Urban Land reported, as this generation continues to make its presence known in the real estate market.

“Its impact on real estate and the economy in general will be as striking and long-lasting as that of the baby boomers,” said Leanne Lachman, governor of the Urban Land Institute and president of Lachman Associates, a real estate consulting and research firm.

A survey by ULI of 1,241 18 to 32 year-olds shows that most Gen Y-ers anticipate buying a home within the next three to five years.

Echo boomers already have massive buying power of more than $200 billion yearly, pointed out Carol Ruiz, assistant chair of ULI’s Residential Neighborhood Development Council. [more]

Land-use restrictions and planning policies like smart growth, rather than bankers, politicians and policy makers, were the engines of the housing boom and bust, says Wendell Cox, an Illinois-based consultant and adjunct scholar with the National Center for Policy Analysis, the Wall Street Journal reported.

In the paper, entitled “The Housing Crash and Smart Growth,” Cox writes: “Gross national house value increases and losses were overwhelmingly concentrated in metropolitan areas with more restrictive land-use regulations…Many metropolitan areas with these land-use restrictions were not able to respond to the increased demand for homeownership caused by the greater availability of mortgage credit. The inevitable result was higher prices.” [more]

“The old ‘normal’ will not return,” said John McIlwain, a senior fellow at the Urban Land Institute and author of a new research paper, “Housing in America: The Next Decade.” According to McIlwain’s, research, the post-recession U.S. housing market will look strikingly different, influenced largely by shifting demographics and consumer behavior. Americans are beginning to abandon the notion that homeownership is the quintessential “American dream,” he said, as evidenced by the growing number of borrowers who are walking away from their mortgages. He predicted that the future will bring a regained popularity in renting, particularly from Generation Y, and a renewed view of homes as shelters, not investments. Baby-boomers, with their home values depreciated and their retirement funds diminished, will show less interest in second homes and later, in traditional retirement communities. “Over time, a new mode of metropolitan development will emerge, presenting opportunities and stiff challenges. Those who fail to understand these new trends will find themselves building what is no longer in demand,” McIlwain said. TRD

A groundbreaking ceremony kicked off a $76 million infrastructure project in Long Island City. Sierra Realty. will assume management of a 10-story historic building. And the Urban Land Institute, the non-profit city development research organization, named Patrick Phillips as new CEO. Click here for more.
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The slice of the billions of dollars in federal money outlined by the
Treasury Department in the stimulus package signed by President Obama
in February will come to New York City largely as incentives to improve
energy efficiency and transportation infrastructure, according to Urban
Land Institute President Richard Rosan, who spoke to a group of around
40 people today at a monthly Association of Builders and Owners of New
York luncheon. Since the city will have a maximum of only 15 percent new building
stock by the year 2030, according to the institute, federal grants and
tax breaks for environmental efficiency improvements are likely to come
to New York in the form of renovations, Rosan said, referring to the
retrofitting of existing office buildings to qualify for LEED
certification. [more]