More Former Homeowners Are Choosing to Rent Due to Affordability and High Homeownership Expenses
CHICAGO (February 5, 2013) – The average monthly apartment rental cost in the U.S. was $1,048 in Q4 2012, up 3.8 percent from a year earlier, according to Reis. At the same time, the nation’s apartment vacancy rate continued a steady decline to 4.5 percent in Q4, the lowest vacancy rate level in more than a decade. In response to this news, Apartments.com conducted a nationwide survey of more than 1,300 renters to gain insights into their moving plans this year.
Through this survey, Apartments.com learned a growing number of former homeowners are choosing to rent; employment relocation, cost savings and apartment size topped the list of reasons that people are moving; and there was a significant increase in renters who are seeking trusted opinions during their apartment search. Additionally, the survey sheds light on:
- Why former homeowners are choosing to rent
- Reasons people are moving in 2013
- Tools people are using to conduct their apartment search
- Who people plan to share their new apartment with
“There is a growing trend toward previous homeowners choosing to rent after carefully considering economic factors such as affordability, employment opportunities and unaffordable homeownership expenses,” said Dick Burke, senior vice president and general manager, Apartments.com. “The fiscal cliff our country was headed toward in December seems to have motivated all renters to take a realistic approach toward budgeting for 2013. Many helpful online tools, including Apartments.com, are available to help renters make informed and responsible decisions when searching for apartments within their budgets.”
Why are previous homeowners choosing to rent?
Supporting a growing trend, more than a third of current renters surveyed (35.1 percent) previously owned a home (up from 33.6 percent in 2012). As in 2012, better affordability and flexibility to choose location topped the list of reasons these previous homeowners are now renting.
However, more previous homeowners surveyed in 2013 indicated they could not keep up with expenses tied to homeownership, more lost their home due to foreclosure or divorce, and fewer relocated for employment.
Apartments.com provides the top five reasons previous homeowners are choosing to rent in 2013, and compares these results to its 2012 survey. The statistics indicate that within the past year, economic struggles may have been a more significant factor in previous homeowners’ renting decisions than in prior years:
- Renting is a more affordable option: 22.2% (down from 26.3% in 2012)
- Flexibility renting offers in choosing where to live: 15.7% (down from 21.2% in 2012)
- Can’t afford to keep up with the expenses associated with homeownership: 14.2% (up from 10.5% in 2012)
- To relocate for employment: 13.3% (down from 20.5% in 2012)
- Lost home due to foreclosure or divorce: 11.2% (up from 5.9% in 2012)
What is the primary reason people are moving in 2013?
As unemployment continues a slow but steady national decline and the U.S. economy stabilizes, survey respondents indicated they are moving in 2013 for reasons primarily having to do with economic situation (31.5 percent) and personal preferences (23.5 percent). Reasons related to family / family situation (16 percent) and education / graduation (11.3 percent) also played a notable role. Apartments.com details the primary reasons respondents said they are moving in 2013:
- Relocating for employment opportunities (economic): 15%
- Shopping for a less expensive apartment (economic): 13.2%
- Looking for a bigger apartment (personal preference): 11.2%
- Change in marital status (family-related): 10.8%
- Wanting to live in a different neighborhood (personal preference): 9.8%
- Relocating for educational reasons (education-related): 6.7%
- Other family reasons (family-related): 5.2%
- Recent college grad moving to their own place (education-related): 4.6%
- Looking for a smaller apartment (economic): 3.3%
- Wanting to live alone (personal preference): 2.5%
What resources do people use to search for their new apartment?
Renters continue to tap multiple resources during their apartment search. While all respondents rely on Apartments.com as the survey was conducted to current website visitors, other online apartment listings websites (such as Craigslist), search engines and review websites are also popular tools for finding a new apartment.
The opinions of others seem to play a more important role in searches than in previous years. More than half of respondents said they use review websites during their apartment search versus 32.6 percent in 2012, and 45.1 percent relied on word of mouth versus 31.5 percent in 2012.
Who will renters share their apartments with in 2013?
One area that seems to be a constant is renter living arrangements, which is nearly identical this year to the results of the 2012 survey:
- Husband/wife/significant other and/or kids: 49.6%
- Living alone: 40.3%
- Roommate(s): 10.1%
As part of its What Renters Want series, Apartments.com surveys renters on various topics throughout the year. For more information on these surveys or to receive a copy of the results, please contact Tammy Kotula at firstname.lastname@example.org.