There’s an important trend developing in real time and seasoned investors are preparing accordingly: a demographic dividend is unfolding. A demographic dividend is when a shift in a population’s age makeup, especially a rise in working-age adults, drives stronger and more predictable rental demand. Right now, multifamily investing is squarely in its path: Millennials are forming households in record numbers, embracing renting as a lifestyle choice, and balancing office days with home-based work. Here’s a closer look at what’s unfolding, and what it means for multifamily fundamentals.
What’s Fueling Today’s Dividend?
- Young Households on the Rise
In 2025, roughly 9.6 million U.S. households are headed by adults under 30. By 2035, that number is projected to swell to 15.1 million, a 57% jump in just ten years. Each of these new households typically starts in the rental market, establishing a dependable pool of renters for years to come.
- Renting as a Deliberate Choice
Gone are the days when renting meant “waiting to buy.” Today, 62% of under-35s rent by choice, compared with 39% of those aged 35 - 44 and just 30% of 45 - 54 year-olds. Freed from maintenance burdens and mortgage commitments, many prioritize amenity-rich communities, walkable neighborhoods, and the freedom to move without selling a home.
- Hybrid Work
Work arrangements aren’t simply “remote versus office” anymore. According to Gallup, 52% of employees with remote-capable roles are in hybrid setups, and 60% say hybrid strikes the right balance between flexibility and collaboration. At the same time, Kastle Systems’ Back to Work Barometer shows office occupancy averaging about 52.8% across ten major U.S. markets, suggesting many renters head in-person 2–3 days a week. Multifamily properties that offer robust connectivity, dedicated workspaces, convenient highway access, and quiet gathering areas continue to see strong leasing velocity.
Supply and Absorption in Balance
Even as roughly 350,000 new apartments came online in 2024, net absorption still reached about 400,000 units, keeping national occupancy near 94.5%. In practical terms, demand has kept pace with deliveries, particularly where properties distinguish themselves through design, location, or resident experience.
What this Means for Multifamily Fundamentals
- Steady occupancy: A growing supply of young renters helps smooth absorption when new units arrive.
- Amenity-driven premiums: Features like in-home work nooks, fitness centers, and pet-friendly spaces can command rent premiums of 5% (or more) above the baseline.
- Broader opportunity set: Hybrid work allows renters to prioritize affordability and community, benefiting markets once overlooked.
- Stronger retention: Curated experiences (think pop-up yoga or communal work events) can cut turnover by up to 20%, keeping lease-up costs down and cash flow predictable.
Final Thoughts
In real time, the demographic dividend is playing out across U.S. multifamily markets. A surge in household formation, a renters-by-choice mindset, and sticky hybrid-work patterns combine to support durable rent growth and occupancy. For limited partners, that translates into reliable cash-flow stability and the promise of long-term value appreciation - the proof that demographics, when properly understood, remain a strategic and powerful force in real estate.
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About Ellie Perlman
Ellie Perlman is the founder and CEO of Blue Lake Capital, a woman owned multifamily real estate investment firm focused on partnering with family offices and accredited investors to build and preserve generational wealth. Since its founding in 2017, Blue Lake has successfully acquired and operated multifamily assets across high-growth U.S. markets, completing $1B+ in transactions.
At Blue Lake Capital, Ellie and her team work exclusively with family offices and accredited investors, offering carefully curated investment opportunities that emphasize long-term wealth creation, stability, and risk-adjusted returns. A defining aspect of Blue Lake’s investment strategy is its integration of advanced AI-driven analytics and data science into the entire lifecycle of acquisitions and asset management. By leveraging cutting-edge technology, the firm executes data-driven forecasting on market trends, asset performance, and tenant behavior, ensuring strategic decision-making and optimized returns.
In addition to leading Blue Lake Capital, Ellie is the original founder and host of "REady2Scale - Real Estate Investing" podcast, which provides insights into multifamily real estate, alternative investments, and finance.
Ellie began her career as a commercial real estate attorney, structuring and negotiating complex transactions for one of Israel’s leading development firms. She later transitioned into property management, overseeing over $100M in assets for Israel’s largest energy company.
Ellie holds a Master’s in Law from Bar-Ilan University in Israel and an MBA from MIT Sloan School of Management.
You can learn more about Blue Lake Capital and Ellie Perlman at www.bluelake-capital.com.
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