Affordability continues to create challenges for would-be buyers, keeping renters in place for longer, according to a new report from Redfin.
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Renters are staying put for longer and longer as homeownership remains out of reach for many, a new report has found.
The report, published Friday by Redfin, found that renters were more likely to stay put in 2022 than they were a decade earlier in 2012.
Among renters surveyed, 16.6 percent had been in their home for over 10 years during 2022, according to the report, up from 13.9 percent of renters a decade ago in 2012. Another 16.4 percent stayed in their home for five to nine years, up from 14 percent a year earlier.
The largest segment of renters stayed put for one to four years, according to Redfin, at 41.8 percent, up from 39.9 percent a decade ago, while 25.2 percent of renters stayed put for only 12 months or less before moving elsewhere in 2022, down from 32.2 percent in 2012, according to a Redfin analysis of United States Census Data.
The report attributes the increase in tenant tenure to a number of factors, chiefly the steep rise in home prices, with the median United States home sale price more than doubling since 2012 and rising more than 40 percent since 2019 alone, alongside elevated mortgage rates. This means more renters have no choice but to remain renters.
Rental prices have risen, too, in the past decade, and are up 20 percent since 2019, the report points out, disincentivizing people from moving from one rental to another and incurring moving costs. Meanwhile, renting as a lifestyle has become more popular, with the rise of remote work making some people less inclined to be tied down to one home.
While homes becoming less affordable is undeniably problematic, there are benefits to renters staying put for longer, the report argues.
“The uptick in tenure is beneficial for renters and their landlords,” said Redfin Senior Economist Sheharyar Bokhari.“While the fact that people are staying longer in their rentals may mean they can’t afford to buy a home in today’s market, staying put also means they’re saving some money that could eventually go toward a down payment if they do have a goal of homeownership.
“Staying in the same home means they’re likely to face smaller rent increases, and they’re saving money on moving costs and application fees. Landlords typically prefer long-term tenants because they don’t have to spend money on cleaning and marketing vacant units.”
Young renters are much more likely to move apartments than older ones, the report found, with 55.5 percent of Gen Z renters staying put for 12 months or less as of 2022, while another 40.6 percent stayed put for one to four years and 20 percent stayed put for five years or more. Among millennials, 28.8 percent had lived in the same home for 12 months or less in 2022, and 50.7 percent stayed put for four years, while roughly 20 percent stayed put for five years or more.
The largest segment of Generation X renters — 39.5 percent — stayed in their homes for four years or more, while just 17.1 percent stayed for 12 months or less. Roughly 22 percent stayed for five to nine years while another 22 percent stayed for 10 years or longer.
Among baby boomers, 32.9 percent stayed in their homes for 10 years or more, while 32.2 percent had lived there for one to four years. Another 21.5 percent had stayed in place for five to nine years while just 13.3 percent had lived there for 12 months or less, the report found.
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