Renters are in better financial straits than they were just six months ago. Is homeownership next?
The answer, according to a recent Freddie Mac survey, is unclear. Although 41 percent of the renters surveyed reported having more cash left over after payday, up from 34 percent in September 2016—and ideal for saving on a down payment on a home—only 15 percent reported working toward homeownership, down from 21 percent in September. Thirty-eight percent of those surveyed do not expect to move in the next two years, also up from September, and 37 percent are unsure of their moving plans, again up from September.
Decidedly, 60 percent of the 35- to 49-year-old renters surveyed, as well as 55 percent of all renters surveyed, reported liking where they live, and staying put even if their rents rise. Fifty-nine percent reported planning to rent their next home—higher than the 45 percent who reported planning to own their next home.
"It would appear from our new survey that renters today feel better about their finances, like where they are living, and view renting favorably," says David Brickman, executive vice president of Freddie Mac Multifamily. "This is consistent with findings from earlier surveys that show a steadily growing number of renters have a positive view of renting."
Who, if it all, could become homeowners? The farthest leaps in financial confidence were observed in the rural renters surveyed, as well as baby boomer renters.
Rents are expected to rise 1 percent over the next year, according to a recent analysis by Zillow.
Source: Freddie Mac