Investment Insights: Overcoming Rental Market Hurdles
As Gen Z enters the rental market in increasing numbers, their financial journey is shaping their housing decisions in ways that property managers and real estate developers must understand. While this generation entered adulthood in a strong job market, they have navigated economic turbulence, including the pandemic’s financial impact and ongoing inflation. According to a Bank of America study, 73% of Gen Z report that today’s economic environment makes saving more difficult, while 75% are actively seeking additional income streams. Additionally, three in five Gen Z renters report being rent-burdened, meaning a significant portion of their income goes toward housing costs.
Despite these financial challenges, Gen Z is proactive about financial education and planning, influencing the broader rental market. The 2025 Zillow annual renter survey highlights three key trends that property owners, managers, and developers should consider when shaping rental offerings and amenities.
Gen Z Represents a Growing Share of the Rental Market
Gen Z now accounts for 25% of all renters in the U.S., second only to millennials, who represent nearly a third of the rental market. While Gen Z renters are a significant demographic, they are less likely to be primary decision-makers within their households, with only 12% identifying as the head of their rental household.
For property managers, this underscores the importance of marketing strategies that appeal to both Gen Z renters and their co-decision makers, such as parents or roommates.
Also Read: Outperform the Competition in Multifamily Apartments
Nearly Half of New Renters Are Gen Z
Gen Z is the most mobile generation in today’s rental market, making up 47% of all recent movers, those who relocated in the past year. In contrast, millennials account for just 28% of recent movers, with Gen X and baby boomers representing only 12% and 11%, respectively.
This level of turnover presents both challenges and opportunities for property managers. Developing seamless move-in processes, leveraging technology for efficient leasing, and offering flexible lease terms can help attract and retain Gen Z renters.
Gen Z Renters Are Future Homebuyers, But Will Rent Longer
Despite affordability challenges, Gen Z remains focused on homeownership, with 64% stating they would be "very or extremely likely" to buy a home if mortgage rates decline. While some Gen Z renters have considered purchasing a home, 27% reported seriously considering buying during their last rental search, the persistent housing deficit (estimated at 4.5 million homes, according to Zillow economists) suggests that many will continue renting for the foreseeable future.
This presents an opportunity for property managers to align amenity offerings and marketing strategies with Gen Z’s priorities. Creating rental experiences that emphasize affordability, convenience, and lifestyle benefits—such as on-demand services, flexible leasing, and technology-driven amenities—can help properties stand out in a competitive market.
Also Read: Adapting Multifamily Real Estate to New Demands
The Role of Amenify in Enhancing the Gen Z Rental Experience
Gen Z renters, like their predecessors, prioritize staying within budget; 95% of renters across all generations consider this factor "essential." Amenify’s integrated amenity services, including on-demand cleaning, handyman assistance, and grocery delivery, offer an added layer of convenience that enhances rental value without increasing operational complexity for property managers.
By incorporating amenity solutions that resonate with Gen Z’s preferences, properties can drive higher retention rates and differentiate themselves in a dynamic rental landscape.
As Gen Z continues to shape the rental market, understanding their behaviors and expectations is crucial for property managers and developers. Partnering with service providers like Amenify can help create communities that attract and retain this influential demographic while maximizing operational efficiency and revenue potential.
FAQs
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The 2% rule suggests that the monthly rental income from an investment property should be at least 2% of its purchase price to ensure it’s a good deal. For example, a $100,000 property should generate at least $2,000 in monthly rent.
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The 50% rule estimates that 50% of a property's rental income will go toward operating expenses (not including mortgage payments), helping investors quickly gauge profitability.
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The 1% rule advises that a rental property’s monthly rent should be at least 1% of its purchase price to determine if it’s a worthwhile investment.
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Evaluate properties using metrics like cash flow, cap rate, ROI, and operating expenses, while considering market trends, location, and long-term appreciation potential.
