Though renters say they dream of owning a home one day, most of them will need to keep renting for at least the next three years, according to a new survey of more than 2,000 adults conducted by Freddie Mac. The majority of renters say they are still struggling financially, but 91 percent say the financial crisis has not deterred their motivation to become home owners.
"It's no secret that for the last several years, consumers have felt more strapped financially, particularly renters," says David Brickman, executive vice president of Freddie Mac Multifamily. "Many renters are not buying homes because of a perceived lack of ability to afford the down payment or mortgage, as well as poor credit history. But there also is a segment of renters who simply do not want the responsibilities of owning a home."
The majority of renters say they're living paycheck to paycheck. Forty-five percent of renters say they have just enough money to get by, and 17 percent say they do not have enough money to pay for basics, such as food and housing, until their next payday. On the other hand, only 38 percent of home owners indicate similar financial struggles.
Still, nearly 40 percent of renters say they hope to purchase a home in the next three years, most of whom are ages 25 to 44, the survey found. Also, if a renter hasn't owned a home by age 45, he or she will likely continue to rent throughout their lifetime, the survey noted.
For now, renters say the top three things about renting are: no responsibility for home maintenance; greater flexibility to move; and protection against any home-price declines, the survey found.
However, renters say the top three things pushing them toward home ownership are: owning something they'd be "proud" of; passing the home on to their children one day; and more flexibility to design the home the way they want it.