Why Functionality is Becoming Rental Housing’s Biggest Differentiator

BY KATHRYN MAGURA FOR PBSA NEWS

For more than a decade, rental housing has been defined by a surge in amenities. Developers have competed to stand out with rooftop pools, co-working lounges, and high-end finishes, often treating these features as signals of quality. But as Gen Z begins to make up a larger share of renters, that approach is starting to lose its edge.

As a result, a different standard is coming to the forefront. The most competitive communities may not be those with the longest list of amenities, but those that consistently deliver on the fundamentals.

That reality has become even clearer to me as a parent of a current college student navigating housing decisions in real time, but also through experience working in student housing at the university level.

What stands out isn’t a push for more features, but for spaces that are functional, reliable, and aligned with everyday needs. For Gen Z, that’s what truly sets a property apart, and for Build to Rent developers and operators, it’s a shift worth paying close attention to.

Early signs of this change are already visible in student housing. Globally, operators are seeing a clear pattern: renters are less interested in standout features and more focused on whether a space works the way it should.

That shift is reflected in broader data as well. Recent research from StarRez that surveyed over 550 North American students found that the top three factors students want are laundry, wifi and parking. The trend also extends globally with 80% of 4,500 surveyed students saying that facilities including wifi are extremely or very important.

Facility fundamentals are outweighing luxurious amenities, but that doesn’t mean amenities have lost total relevance. Instead, their role has become more supportive than central. Even when specific features are valued, they tend to align with everyday functionality and are weighed against the cost of rent.

When asked what amenities students would exclude from their accommodation to achieve a cheaper rent in the purpose-built student accommodation (PBSA) domain, they listed function-specific rooms (cinema, glamour, gaming, etc.), on-site swimming pools and on-site restaurants at the top of the list.

However, fast wifi, on-site laundry, and 24-hour security were all amenities that would be a last resort to leave behind. For Build to Rent operators, this points to a need for intentional decision-making around where and how to invest.

As Gen Z renters transition off campus, those priorities go with them. Navigating leases, budgets, and shared living arrangements introduces new friction, especially for first-time renters. In that environment, simplicity and reliability carry real weight. Clear communication, intuitive systems, and dependable management are the factors that end up shaping the overall experience this generation will have.

However, this is where disconnects can emerge. Many communities continue to lean into lifestyle features, while many renters are still focused on mastering the basics of independent living. The result is a gap between what is marketed and what is actually meaningful on a day-to-day basis.

Part of this shift comes down to the resources most Gen Zers had available throughout their lives. Constant connectivity and on-demand access have set a high bar for convenience, while broader economic pressures have made consistency and value more important than ever.

In fact, nearly three-quarters of Gen Z renters view renting as a financially strategic choice, underscoring how closely housing decisions are tied to cost, flexibility, and reliability. Spaces that are easy to navigate, dependable, and thoughtfully designed tend to resonate more than those built primarily around visual appeal.

For Build to Rent developers and operators, student housing is a leading indicator for what will attract and retain future renters, and as Gen Z enters the broader housing market, their expectations are coming with them. As competition intensifies and traditional differentiators lose impact, communities that fail to realign risk falling behind. Those that adapt early can gain a competitive edge and offer housing solutions that meet Gen Z expectations.

The bottom line is that Gen Z is reshaping how amenities are valued, elevating what was once considered secondary into something far more essential. The question is no longer what a community offers, but whether it delivers where it counts.

In a market that increasingly rewards consistency over flash, getting the fundamentals right is what will give Build to Rent developers a strategic advantage. Doing so at scale often requires the right operational infrastructure, including platforms like StarRez that help communities streamline and automate their workflows.