WASHINGTON–A somewhat unexpected trend is putting pressure on rental prices: Baby Boomers and others aged 55 or older, including several million current homeowners, are now moving into rental units, according to Freddie Mac.
The inaugural Freddie Mac 55+ Survey of housing plans and perceptions found an estimated six million homeowners and nearly as many renters prefer to move again and rent at some point. Of those that expect to move again, over five million indicate they are likely to rent by 2020, Freddie Mac said.
Majorities of 55+ renters (79%) and homeowners (83%) who expect to rent their next home predict it will cost the same or less than their current one, according to the Freddie Mac 55+ Survey.
"When a population this large expects to move into less expensive rental housing, we have to expect it will create significant new pressure on both the supply and cost of existing affordable rental housing," said David Brickman, executive vice president, Freddie Mac Multifamily, in a released statement.
Other findings from the Freddie Mac 55+ Survey:
- Just over half of renters (51%) prefer renting over owning. This is especially true among existing multifamily renters (60%).
- Forty-seven percent of 55+ renters say they struggle from payday to payday, while 13% admitted they sometimes could not afford basics until their next paycheck.