McLean, Va.—In a recent survey, Freddie Mac found that U.S. renters are more worried about rising utility bills than rising rents, and that nearly half of renters surveyed say they’re willing to pay more for rentals with cost-saving water and energy features. There was also no change in the propensity to rent, with a small majority saying they expect to rent their next home.
Compared to earlier surveys, the new research (done in September) shows more renters saying they’re satisfied with their rental experience, but worried about their financial situations. A majority of renters say they put more importance on saving for emergencies, children’s education or retirement than on down payments for a home.
For the first time, the Freddie Mac survey included questions about renter perceptions and concerns about utility costs. One finding from those questions was that 70 percent of renters say they’re moderately to greatly concerned about higher utility bills. By contrast, only 63 percent shared the same levels of concern about potential rent increases. Seventy-four percent say higher utility bills would have “some impact” or a “great impact” on their household finances, almost as many as those who said the same (78 percent) about higher rents.
Moreover, renters are aware of sustainable features, and approve of them in most cases. A large majority (88 percent) agreed multifamily properties with green energy- and water-saving features would help reduce their utility bills, with 84 percent saying green properties are generally better places to live. Nearly half (47 percent) say they are willing to pay more for an environmentally friendly rental.
Also included in the survey: renter satisfaction. Specifically, 44 percent of renters said in September they were very satisfied, up from 33 percent in January 2016. Adding in those who are moderately satisfied increases the overall percentage of satisfied renters to 66 percent. At the same time, the number of respondents who say renting is more affordable than owning fell from 69 percent in January to 65 percent in September.
Fifty-five percent of the respondents expect to rent their next residence while 45 percent expect to buy. That’s unchanged from renter surveys in January 2016 and October 2015. Of those who plan to move, Gen-Xers are the only cohort where a majority (58 percent) say they plan to buy their next home, but they are also the group most likely to worry about their household financial situation.
Conducted in September for Freddie Mac by the Harris Poll, the findings are based on responses from 1,362 renters. That includes Millennials (aged 18-34), Gen-X’ers (35-49) and Baby Boomers (50-68).