More than two thirds of renters (38%) in the U.S. say they’ll never own a home due to lack of affordability, a recent survey from Redfin shows.
That’s up from roughly one-quarter (27%) less than a year ago, according to the technology-powered real estate brokerage.
Nearly half (44%) of renters who don’t believe they’ll buy a home in the near future say it’s because available homes are too expensive.
The next most common obstacles: Ability to save for a down payment (35%), ability to afford mortgage payments (33%) and high mortgage rates (32%).
Roughly one in eight (14%) simply aren’t interested in owning a home.
This is according to a Redfin-commissioned survey of roughly 3,000 U.S. residents, including about 1,000 renters, conducted by Qualtrics in February 2024.
Many renters can’t fathom homeownership because they’re already struggling to afford their monthly housing costs. Nearly one-quarter (24%) of renters say they regularly struggle to afford their housing payments, and an additional 45% say they sometimes struggle to do so.
Rents have soared over the last few years because so many people moved during the pandemic, upping demand for rentals. The median U.S. asking rent is roughly $2,000, near the record high hit in 2022—but the good news for renters is that prices aren’t growing nearly as fast as they were during the pandemic, partly because an influx of apartment supply is taking some of the heat off prices.
“Housing costs are high across the board, but renting is a more affordable and realistic option for many Americans right now—especially those who have never owned a home and aren’t able to tap into equity from a previous sale,” says Daryl Fairweather, chief economist fr Redfin, in the report. “While owning a home is usually a sound long-term investment, the barriers to entry and upfront costs of buying are higher than renting. Buying typically requires a sizable down payment and approval for a mortgage—things that are difficult for many people today, when the typical down payment is near $60,000 and mortgage payments are sky-high. The sheer expense of purchasing a home is causing the American Dream of homeownership to lose some of its shine.”
Photo: Karsten Winegeart