MCLEAN, Va.–Renters are feeling better about their financial situations and expecting to stay put even if rents increase, while fewer are also expressing plans to work toward buying a home within the next few years.
The latest Freddie Mac renter survey found many renters say renting is a good choice for them, believe renting will remain affordable, and are interested in moving into a smaller rental unit to be closer to a city. Freddie Mac said it found that while sentiments differ among urban, suburban and rural households, those saying they expect to rent their next home increased to 59% from 55% since Freddie Mac's last renter survey in September 2016.
"It would appear from our new survey that renters today feel better about their finances, like where they are living, and view renting favorably,” said David Brickman, EVP-Freddie Mac Multifamily, in a statement. “This is consistent with findings from earlier surveys that show a steadily growing number of renters have a positive view of renting.”
Among the other findings:
- 41% of renters now say they have enough money to last beyond each payday, up from 34% in September 2016.
- Those who say they cannot afford essentials fell from 20% to 14%.
- Those saying they have enough to cover their expenses from payday to payday remained relatively unchanged at about 45%.
- Financial confidence rose for renters in all age groups no matter where they live. The biggest increases were among rural households, up from 27% to 46%, and Baby Boomers, up from 38% to 48%, Freddie Mac said.
Freddie Mac found that despite people saying they are more confident in their financial situation, that has not translated into plans to move. Instead, the number of renters who don't know when they expect to move rose to 37% from 30%, while those who expect to move during the next two years fell from 38% to 33% since September. Moreover, 55% of all respondents, and 60% of 35- to 49-year olds, say they like where they live and don't plan to move if their rents rose, Freddie Mac said.
Other findings:
- The number of renters who say renting is a good choice for them rose to 52% from 46% since January 2016. Views on rent affordability have remained relatively flat at 68%.
- The number of renters who say they plan to rent their next home rose from 55% to 59% since September 2016. The biggest increases were among suburban households, up from 48% to 57%, and younger Millennials (ages 18-24), which rose from 64% to 73%.
- While homeownership remains on the horizon, the percentage of renters who expect to own fell to 41% from 45% since September 2016. Similarly, in response to a related question, the number of renters who say they are working toward homeownership fell from 21% to 15 over the same period.