Why so many renters aren’t buying homes yet

Why so many renters aren’t buying homes yet

The Fiscal Times

Why So Many Renters Aren’t Buying Homes Yet

Why So Many Renters Aren’t Buying Homes Yet

There is a simple reason why so many renters aren’t buying into the proverbial American Dream of owning a home: They don’t want to.

More than third of non-homeowners surveyed by Bankrate said they don’t want to buy a place, or at least not yet.

The survey found that Americans with higher education and those earning more than $50,000 a year were the most likely to delay buying a home, along with Millennials. Even so, only 4 percent of those surveyed said they never planned on owning a home. Other recent studies that have similarly found that Millennials haven’t sworn off buying a home altogether but feel that financial pressures are preventing them from doing so in the near future.

“It’s not surprising that a lot of Millennials aren’t interested in home ownership yet. Renting allows them more freedom to move,” said Holden Lewis, Bankrate’s senior mortgage analyst.

Middle-aged Americans also say it’s not the lack of desire but rather the lack of means keeping them from homeownership. More than half said they don’t have enough for a down payment or they don’t have a good enough credit score to qualify for a home loan, according to the survey.

Related: The Surprising Problem That’s Holding Back the Housing Market

Three in 10 Hispanics — the group least likely to want to remain renters — reported that their credit was an obstacle to homeownership, the highest level among all demographic groups.

Credit isn’t a problem for those 65 and older. About a quarter in that age group couldn’t afford a down payment, while another 30 percent said they don’t want to own a home yet. Nearly four in 10 seniors offered other reasons for not owning a home, such as health factors, inability to keep up with home maintenance, financial restraints or living in a home for seniors.

Overall, non-homeowners are aiming high for their down-payment plans. More than a third expect to put between 6 percent and 20 percent of the purchase price as a down payment. Thirteen percent plan to contribute 5 percent or less, while a fifth intend to pay more than the traditional 20 percent down.

Advertisements

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s