Owning your own home may still be the American dream, but over the last decade, there’s been a huge evolution in how Americans view renting.
“The recession pushed many to rent out of necessity,” say real estate experts at RENTCafé. But “the economic expansion which followed, coupled with changing attitudes towards family and homeownership, lead to the rise of the renter by choice.”
Housing trends over the past decade have made renting an increasingly popular choice for Americans, with over 100 million people opting to rent instead of buy. “An increasing number of Americans are renting as a lifestyle option—it’s easier to move neighborhoods or cities when you’re not tied down to a mortgage,” say experts at RENTCafé.
Check out our previous article on buying versus renting: “Renting In Retirement: Even The President Is Doing It!”
No surprise, then, that rents have shot up over the last decade, climbing more than home prices in many cities during the same period. For example, in Denver and Phoenix, two growing cities attractive to young workers, rents have inflated by 85% and 71% respectively.
The unprecedented demand for attractive rental properties explains part of the growing rental cost. Another factor is that rentals have gone significantly upscale to satisfy quality-seeking lifestyle renters in their quest for increasingly sophisticated rental housing.
In fact, more high-earning Americans are renting than ever before (the number of high-earning renters actually quadrupled in some popular cities over the last 10 years.)
In addition, more seniors are opting for the rental lifestyle. Age 60-and-over renters increased by a whopping 80% in retirement locales like Raleigh, NC and Jacksonville, Florida.
We’ve seen several of our own clients transition from owning to renting lately. They’re happy to get rid of the maintenance hassles of owning a home, and appreciate the conveniences and extensive activities offered in high-end rental communities. Many also have considerable equity in their homes, and would rather convert that equity into a growing retirement income stream that they can use to enhance their lifestyle, rather than have it trapped within their home.
Unfortunately, among all the positive developments concerning rentals, there’s one negative that’s bound not to be a crowd pleaser. The average size of new apartments is shrinking, losing 57 square feet – or the size of a medium bathroom – over the past decade.