Few Renters Expecting to Purchase a Home Anytime Soon

Most of today's renters will still be renters three years from now, despite the vast majority viewing homeownership as something to take pride in, according to an online poll.

In a survey of more than 2,000 American adults, 61 percent of renters said they don't plan to purchase a house at any point in the next three years, Freddie Mac said Monday.

When asked why they expect to keep renting for the near future, half of respondents said they can't afford to make a down payment for a mortgage, while 38 percent said they can't afford a monthly mortgage payment. Those percentages were higher among respondents ages 25–44—prime homebuying years for most Americans.

On the other hand, that same age group was also the likeliest to buy in the coming years: 47 percent of renters age 25–34 and 58 percent of renters age 35–44 expect to purchase a house in three years compared to just 27 percent of those 45–64.

“It's no secret that for the last several years, consumers have felt more strapped financially, particularly renters,” said David Brickman, EVP of Freddie Mac Multifamily. “Many renters are not buying homes because of a perceived lack of ability to afford the down payment or mortgage and poor credit history.”

The majority of renters—45 percent—said they're living paycheck to paycheck at this point, with little or no money to spare on buying things they want. Only 31 percent of homeowners said the same thing.

Meanwhile, 17 percent of renters are sometimes not even able to pay for basic necessities like food or housing until their next payday compared to 7 percent of homeowners.

Lifestyle choices also played a role in some respondents' desire to rent over buying. According to the survey, 39 percent of U.S. adults don't want the responsibilities that come with owning a home, particularly those who are entering or are already in their retirement age.

According to renters, the top three favorable factors about renting are freedom from home maintenance responsibilities (with 78 percent agreeing), greater flexibility on where they live (68 percent), and protection against home price volatility (66 percent).

On the other hand, the top-cited benefits of homeownership had less to do with convenience and more to do with sentiment: 91 percent of renters said owning a home is something to be proud of, while 90 percent said they would like to be able to pass a home on to their children.