High rent is the norm in big cities. In cities in the U.S. and around the globe, rents for one-bedroom homes tend to be high, with some exceptions. High rents in these areas may cause some consumers to switch from renting to homeownership. According to U.S. News, however, while many cities are seeing a shift from renting to homeownership in the face of rising rent costs, Detroit renters surpass homeowners for the first time in 50 years.
MReport previously reported that 15 of the 23 U.S. cities covered by the Beracha, Hardin & Johnson (BH&J) Buy vs. Rent Index were in a “buy” territory, as opposed to “rent.” But in Detroit, the opposite is true, as the latest estimates available from the U.S. Census Bureau show that about 53 percent of Detroit residents rent their homes.
Wendy Lewis Jackson, who manages the Kresge Foundation's Detroit revitalization programs, told U.S. News that the switch to a majority-rental market creates a need for new ways of thinking about the city.
"I think there's an opportunity because many families with young children have moved into these homes," she said. "And so now, how do we as a city put the right supports around the rental market to ensure stability?"
Though this may cause some economic concern, Anika Goss-Foster, director of the Detroit Future City Implementation Office, said the trend doesn't mean Detroit is on a downward spiral.
"But it does mean that we need to pay more attention to this market. Because not only are there more renters, there are low-income renters living in poor-quality housing, and that's really what we need to be concerned about," Godd-Foster told U.S. News. Goss-Foster estimates that one in five single-family rented homes in Detroit have been provided subsidies by state or federal housing programs.
"This is poor-quality expensive housing that people can't afford to maintain or live in," Goss-Foster said. "It's a really big problem."