Renters aren’t the old ones turning to single-family rentals. So are a sizable share of current homeowners, according to a new report.
In it’s July consumer survey of nearly 1,350 owners and renters, John Burns Real Estate Consulting discovered that one in four owners would live in a rental house if they could find a place that meets their exact needs.
Such a sentiment is greatest among young owners, a third of whom prize a home’s function over ownership. At the same time, though, a growing set of older people would consider trading ownership for renting if the location was right. More than half, for example, would rent a place so they could live closer to family.
“Trading in home ownership for renting is an ever-growing scenario” among older people, says Maegan Sherlock, a Burns firm research analyst.
Once older owners have been converted, moreover, they are likely to continue renting. The survey found that 57 percent of mature renters, either married, single or couples, have owned a house before but two thirds of them have no plans to own again.
Why? “Maintenance is a big reason,” Sherlock reports. “Per our Master Plans and Amenities report, the top two reasons build-to-rent communities appeal to homeowners are community upkeep and having less maintenance responsibilities.” (These findings were based on a February 2022 survey of 1,199 homeowners with household incomes of $50,000 or more.)
Owners Have Their Reasons
The new survey also found that while the vast majority of owners value the importance of ownership, only two thirds of renters feel the same. And roughly the same percentage feel the current economic environment is the wrong time to take leap.
As a result, the Irvine, Calif.-based marketing and advisory firm thinks purchases are “are going to be delayed…and rental demand will strengthen, creating tail winds for the already robust rental market.”
To meet the demand, the company advises investors in single-family homes to focus on converting current owners by providing a home that “meets their exact needs” in a professionally managed property. It also suggests offering future purchase opportunities for residents who are so inclined.
Attracting mature renters “may require a more localized focus,” Sherlock says. “Our research suggests that a growing number of older Americans are prioritizing location over home and Baby Boomers value location most.”
Actually, the reasons people prefer to rent single-family houses over apartments don’t seem to vary all that much, even by age. For example, young singles, couple and families rank a private yard as the most important factor, while mature families, couples and singles rank yards as second most important, according to yet another Burns company survey, this one of 1,160 single-family renters taken last year.
But that finding flips when it comes to the desire to have no one living above or below them. That reason ranks first among the older set and second among the younger group.
While the top two factors are fairly consistent, the third main reason people prefer to rent varies considerably. Young singles and couples want pet-friendly residences, as do mature families. But young families prefer large common areas while mature singles and couples want an attached garage.