Why High-Income Households are Downsizing to Rent
The U.S. is home to more renters than ever before. Today’s renters aren’t just students and those who can’t afford to buy, however. Renting is also growing more attractive to wealthy Americans seeking convenience, flexibility, and efficiency. The number of high-earning renter households rose 45% between 2010 and 2018 before spiking even higher during the COVID-19 pandemic.
Why are high-earning Americans renting at record rates, and what does this mean for the multifamily sector? These are the need-to-know insights from Home Girls Properties.
Why high-earning Americans are choosing to rent
Renting has long been associated with less space, autonomy, and stability. So why are well-to-do Americans choosing to rent?
Rising home prices make renting more favorable for young professionals who may lack the savings for a down payment or the emergency fund to weather the unexpected costs of homeownership. Renting is cheaper than buying in several top markets including Dallas-Fort Worth, Texas; San Diego, California; and Seattle, Washington. That’s before factoring in the upfront costs of buying a home.
Young adults are also waiting longer to get married and start families. For these households, renting is a practical choice as well as a financial one.
Remote work made Americans realize they can work anywhere. In response, they’ve left high-priced urban centers for areas with lower costs of living, proximity to family, and greater recreational opportunities.
These professionals aren’t setting down roots, however. Instead, they’re taking advantage of renting’s flexibility to keep their options open. Whether you want to explore a new destination every few months or pursue new opportunities at a moment’s notice, renting makes it possible.
Walkable neighborhoods, on-site amenities, and maintenance-free living appeal to Americans of all ages. Retirees, working professionals, and families alike want to spend less time commuting and keeping house and more time enjoying their lifestyle.
Renting not only delivers a central location at a lower cost than a comparable home, luxury rental communities include top-shelf amenities: Of the 611 properties currently for lease in Fort Worth, TX, 266 include a fitness center, 208 have on-site personnel, and nearly 378 boast a pool.
Aging in Place
Retirees are ready to downsize from suburban homes to walkable communities, but they face fierce competition for affordable houses in desirable locations. Rather than sacrifice a great location, they’re leaving homeownership behind in favor of a low-maintenance renter lifestyle.
Beyond the immediate cost savings, renting avoids many of the accessibility issues related to aging in place. Homeowners spend thousands modifying homes for aging in place, whereas many modern apartments are built with accessibility in mind with features like elevators, open floor plans, and hardwood floors.
Is this the year to invest in multifamily property?
With more high-earning households entering the rental market, is 2021 the year to invest in multifamily rental property? Multifamily real estate historically outperforms other commercial real estate sectors through downturns and the demand for modern multifamily housing is only rising.
Fort Worth is among the hottest markets to watch in multifamily. With this in mind, 2021 could be ripe for opportunity in the multifamily sector. Let Home Girls Properties guide you through the process of finding your next home in Fort Worth. Contact to learn more. (214) 676-1085