Buying a home is now cheaper than renting in most of the country’s housing markets. A litany of recent studies and surveys have almost belabored the point given home values and historically low interest rates.
Now there’s new data suggesting renters have clearly noticed the trend — and they’re planning to pounce sooner rather than later.
Sixty percent of renters who hope to one day own a home now plan to buy one in the next two years, according to a survey by national homebuilder Pulte Group. That also happens to represent a 60 percent increase from just a year ago.
Renters cited a host of reasons for their changing views regarding homeownership. The top three were:
- They like being able to call themselves homeowners (49 percent)
- They view it as a good financial investment (44 percent
- They need more space for their family/kids (36 percent)
“We are seeing a renewed sense of optimism, especially from young professionals and young families visiting our communities nationwide,” Deborah Meyer, senior vice president of PulteGroup. “Homeownership is more attainable than ever with historically low mortgage rates and competitive pricing, as well as affordable new homes designed for first-time home buyers coming into the market.”
But there are still hurdles and significant questions facing renters nationwide. The survey also notes the main reasons why some renters are still holding out:
- Not enough money for down payment (54 percent)
- The belief that renting is cheaper than buying (28 percent)
- Uncertainty with employment status (23 percent)
Additional homeowner surveys also turned up some surprising information about our expectations regarding multi-generational housing.
A whopping 31 percent of homeowners with children aged 16 to 30 and those with living parents anticipate having at least one child returning to the nest down the road, according to the separate Pulte Group survey.
That may usher in a boom period for homebuilders, home sellers and contractors. Nearly half of homeowners who are expecting their children to return will either renovate their existing home or purchase a new one.
About the author: Chris Birk writes about real estate and the mortgage industry for a host of sites and publications, from Lenderama and Bigger Pockets to the Huffington Post and Motley Fool. A former newspaper and magazine writer, he is also content director for a leading VA lender. Follow him on Google+.