In today’s intensely competitive housing market, most of those who moved recently considered both buying and renting while looking for a new place to live, according to the Zillow Group Report on Consumer Housing Trends.
It takes more than 10 weeks to find a new home to rent – and more than 12 weeks for those with low incomes or those searching in tight rental markets, according to an analysis of the Zillow Group Report and U.S. Census data. For home buyers, the search is longer – 17 weeks.
The Zillow Group Report, available for free in its entirety, surveyed more than 13,000 renters, homeowners, buyers and sellers about their home search, aspirations, and preferences.
More than half — 54 percent — of buyers do not get the first home on which they make an offer. First-time home buyers make up 47 percent of all buyers, so it’s feasible for many potential buyers to keep their options open and return to renting if they aren’t successful purchasing a home.
“The line between renting and buying is blurry, and that’s a sign of the times,” said Zillow Chief Marketing Officer Jeremy Wacksman. “It’s difficult and time-consuming to find a home to move to, especially in competitive housing markets. With first-time buyers competing for a limited number of homes on the market, savvy shoppers have a Plan B, hoping to buy if it works out, but willing to sign a lease for a home if they don’t make a deal by the time they need to move.”
Among those who bought a home in the last 12 months, 66 percent of Millennials considered renting as well. Just over half (54 percent) of Generation X buyers considered renting, and 32 percent of Baby Boomer buyers.
Younger renters are also more flexible when looking for a home to rent – 63 percent of Millennials and 59 percent of Generation X renters considered buying while looking for a rental. Among renters over 50, most did not consider buying at all.
Renters make up a larger group of the U.S. population than at any time in the last 50 years. Last week, the U.S. Census Bureau reported the homeownership rate rose very slightly to 63.5 percent in the third quarter of 2016 – barely edging up from a 51-year low.
For many renters, buying is not a financial option. The median income of home buyers is $87,500 a year, while renters make, on average, $37,500. Low-income renters looking for a new home in a tight rental market can expect to spend an average of 12.1 weeks looking for a home, according to Zillow’s analysis of survey responses and rental markets.