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Are Millennials Becoming “Forever Renters?”

CPI capital_Are Millennials Becoming Forever Renters

by | Aug 30, 2023

Dear valued existing investors and future investors,

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Notwithstanding successive US governments implementing a variety of policies to encourage home ownership over many decades, there are still large groups of people who prefer not to own but, more importantly, no matter what policies the government introduces, cannot afford to own. There are a variety of reasons for such; for example, perhaps they cannot get enough initial deposit together to make a down payment or don’t have a secure enough job to be able to afford ongoing, regular mortgage payments or are content to live in rent controlled properties.

Amongst this grouping of people who continue to rent multifamily apartments or SFH are Millennials; so, this week, we thought we’d take a look at this important demographic which comprises a large percentage of the total demand for and occupancy of multifamily homes across the country.

Who or what are Millennials?

The Millennial generation (the generation born between 1981 and 1996) are the generation which came of age in the early 21st century. Also known as Generation Y, they are often characterised as tech-savvy, diverse, and socially conscious. They grew up during a time of rapid technological advancements, globalisation and economic uncertainty, which has shaped their outlook on life and values.

Millennials are often associated with the rise of social media and the sharing economy, as well as the pursuit of work-life balance and a desire for meaningful experiences.

Indeed, Millennials have been involved in changing or “disrupting” many traditional ideas or ways of doing business—and the way they occupy real estate is no different.

Why Millennials do not want to own Homes but rent multifamily units or single homes

The preference for renting multifamily units or single homes instead of owning a property is a trend that has become more prevalent among millennials in recent years. There are several reasons why this is the case, including:

Mobility and flexibility

Millennials are a generation that values flexibility and mobility. Renting offers them the freedom to move to different locations for work or personal reasons without being tied down to a particular property. They may also prefer to try out different neighborhoods and cities before committing to buying a home.


For many Millennials, buying a home is simply not financially feasible due to high home prices and student loan debt. Renting allows them to live in desirable areas without the high upfront costs associated with homeownership.

Maintenance and repair costs

Owning a property comes with additional costs beyond mortgage repayment, such as property taxes, insurance, and maintenance and repair expenses. For Millennials who may not have the financial stability or desire to take on these additional expenses, renting may be a more appealing option.


Many multifamily units and single homes for rent offer amenities such as gyms, swimming pools and communal spaces that may be too costly for millennials to have in their own homes. Renting allows them to enjoy these amenities without having to pay for them directly.

Environmental consciousness

For some Millennials, renting is a more environmentally conscious choice. They may prefer to live in a shared space with others and reduce their carbon footprint by not owning a large home that requires a lot of energy to maintain.

Why Millennials can’t afford to buy their own property

So, whilst there are several reasons as outlined above why Millennials may prefer renting over owning, one of the primary factors is affordability.

Here are some reasons why Millennials may struggle to afford to buy their own property:

High student loan debt

One of the biggest challenges facing Millennials is the burden of student loan debt. Many Millennials are still paying off their student loans, which can make it difficult to save up for a down payment on a home.

Stagnant wages

Millennials are often referred to as the “lost generation” when it comes to wages. They have experienced slow wage growth compared to previous generations, which can make it difficult to save up for a down payment or afford a mortgage payment.

High home prices

In many parts of the country, home prices have skyrocketed, making it difficult for Millennials to afford to buy a home. This is particularly true in locations in cities where the cost of living is high.

Tight credit

Since the 2008 financial crisis, banks have tightened their lending standards, making it harder for Millennials to qualify for a mortgage. This can make it difficult for Millennials with lower credit scores or irregular income to get approved for a loan.

Increased debt

In the absence of inherited generational wealth Millennials are also facing increased debt in other areas, such as credit card debt and auto loans. This can make it harder for them to save up for a down payment or afford the monthly mortgage payment.

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CPI Capital understands that Millennials have different priorities when it comes to home ownership compared to previous generations. Renting a multifamily unit or single home offers more flexibility, affordability and convenience in terms of living and job mobility

CPI Capital also holds the opinion that, given that the main challenges many Millennials face ie affordability due to high student loan debt, stagnant wages, high home prices, tight credit, and increased debt in other areas, elective homeownership may continue to be out of reach for many. Yet another reason that such demand for multifamily apartments and, therefore, high occupancy will be sustained over the long term.

Yours sincerely,
August Biniaz
CIO, Co-Founder CPI Capital

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