The majority of Americans who do not own their own home say they intend to one day and hold strong feelings toward home ownership. But how about those 20 percent of households who are adamant about renting and say they intend to stay renters now and in the future?
About 20 percent of renting households don’t have any intentions to purchase a home in the future, and researchers at Harvard’s Joint Center for Housing Studies recently surveyed such renters to find out why they’re shying away from what’s some consider the “American dream” of home ownership.
The bottom line: It’s not the lifestyle choices but financial constraints that renters say keep them from purchasing a home in the future. More than half of renters recently surveyed said they do not intend to buy because they think they cannot afford it or their credit is not good enough, according to JCHS.
According to the research, the top 10 reasons renters give for not planning to buy in the future:
- Cannot afford the purchase or upkeep of a home
- Not good enough credit for a mortgage
- Not a good time economically to buy a home
- Cheaper per month to rent than to buy
- Don’t want to be concerned with doing the upkeep
- Don’t plan to be in a certain area for an extended period of time
- Rather use the money for other investments than a home
- Process of buying a home seems too complicated
- Purchasing a home limits flexibility in future choices
- Can live in better neighborhood by renting
“These results suggest that about a third of renters, or 10 percent of all households, rent because of lifestyle and personal preferences,” writes Rachel Bogardus Drew, a post-doctoral fellow conducting the research for JCHS. “That their reasons appear to be largely idiosyncratic, rather than systematically related to their personal characteristics, further indicates that those who rent by choice do so in spite of strong social biases towards ownership that encourage the remaining 90 percent of households to view owning favorably. More than half of lifetime renters, however, see their tenure options as constrained, either by their own financial circumstances or by macroeconomic conditions.”