Should You Rent Or Buy A Home?

New Survey Finds 76 Percent of Consumers now Believe Renting to Be a Better Option Over Homeownership

Advantages Cited Include Flexibility to Move to a Different Location with New Job Opportunities

Dennis Norman

Last month I did a post addressing housing affordability, the cost of renting versus owning a home, and whether the real estate market over the past couple of years was causing the idea of home ownership as the “Great American Dream to “lose some of it’s sizzle?

For this reason I found a survey, conducted by Harris Interactive and commissioned by the National Apartment Association, that came out today particularly interesting.   The survey found 76 percent of consumers deem renting to be the more favorable option to owning a home in the current real estate market, a 5 percent increase from 2008. The survey also found that both renters and homeowners are not eager to make any changes in their housing status within the next year, demonstrating low consumer confidence and continued uncertainty in the housing market.

“While some may want to declare the housing crisis over, consumer patterns of behavior are showing otherwise,” said National Apartment Association (NAA) President Douglas Culkin. “The findings in this survey mirror what our members are seeing throughout the country, especially in areas of the country that are experiencing the first signs of economic recovery.”

Highlights from the survey:

  • 76 percent of adults feel that there are advantages to renting versus owning in the current real estate market, an increase of 5 percent from 2008.
    • 64 percent cited having no responsibility for major repairs or maintenance as the primary reason.
    • 50 percent cited financial reasons such as not being impacted by an unpredictable real estate market (33 percent – an increase of 1 percent from 2008), and not being susceptible to foreclosure (tied at 33 percent).
  • Renters are not eager to make a change this year: 60 percent of renters plan to continue renting their current residence or rent new residences within the next year.
    • 12 percent of renters said they have plans to buy a new home this year and only 14 percent believe that buying a house is preferable to renting given the current state of the market.
  • 71 percent of homeowners will stay in their current home over the next year, mirroring almost exactly the response from 2008 (72 percent).
  • 93 percent of adults feel that the financial security of homeowners is more or equally affected by the current state of the housing market – no change from 2008 – illustrating that the economic impact of the foreclosure crisis has not shifted or improved.

“The results are yet to be seen if the tax-credit incentives worked, but the larger issue remains that pushing the idea of homeownership as the only way to achieve the American Dream is not a viable strategy for the future,” NAA’s Culkin said.

I’m not saying that home ownership is for everyone, nor is leasing, but I think the facts in my post last month I mentioned at the outset of this post as well as this survey show that perhaps the tide is changing; over the past 3 years millions of  Americans have lost homes in foreclosure, others have been forced to do short sales or deeds in lieu….it’s hard for this type of experience not to change your outlook.  It may very well be temporary or short-lived though…afterall how many people do you know that go through an ugly divorce and in the end want nothing to do with the thought of ever being married again…..only to turn up married a year down the road?

Who knows, a year or so from now, when the memories of the real-estate market induced pain and suffering has faded, we may all fall in love with the idea of home ownership again….

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