Are Older Americans Souring on Homeownership?
Renting a property, whether it’s an apartment or a whole house, has become extremely popular in the last few years as a result of the difficult economy and flagging housing market, but new improvements in both seem to be encouraging many to turn their eyes toward homeownership.
The vast majority of people consider both homeownership and renting to be good experiences, but the number who view the former as being “very positive” is nearly double that of those who feel the same about renting, according to new data from the government-sponsored mortgage backing enterprise Fannie Mae.
Currently, 71 percent of those polled felt homeownership was “very positive,” versus just 34 percent for renting. Meanwhile, 17 percent of respondents said they believe that renting can be a somewhat or very negative experience, compared with just 5 percent for owning.
The reasons for these positive feelings are myriad, the report said. Those who felt they were better off renting said it was beneficial for helping to stay within their budget, avoid stress and wait out the current economic climate. Meanwhile, they also had far better opinions of ownership, because it might give them a better chance to control their living space, have more privacy, and live in better areas or properties, among others. They generally felt ownership was better in terms of both lifestyle and financial reasons, as well.
Young renters, between the ages of 18 and 34, were actually more likely than their older counterparts to have a positive view of ownership versus renting, as 57 percent of that demographic felt that it would be preferable for both lifestyle and financial reasons, compared with 51 percent of renters overall, the report said. In fact, 49 percent of young people said their reason for renting was so that they could become financially capable of buying a home in the future, compared with just 26 percent of people 35 or older. Among that group, slightly less than a quarter felt that renting was a more affordable option, while just 15 percent of younger people.
Homeownership, however, may still be somewhat difficult for many consumers to achieve even if they are financially ready to do so, because lending restrictions currently in place may make it extremely difficult for those without exceptional credit to obtain a mortgage. For this reason, prospective owners may want to significantly improve their standings before they apply. If you don’t know where you stand, you can use the free Credit Report Card to monitor your credit and learn how to improve your score.
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