Renters in the United States are now staying put longer as soaring housing costs and elevated mortgage rates price many out of homeownership.
Most US renters move out of their units within five years. However, a recent report from Redfin found that a growing number is staying put much longer. In 2022, 16.6% of renters said they had stayed in their homes for 10 years or more. That is up from 13.9% a decade earlier. One in six (16.4%) said they lived in their home between five to nine years, up from 14% a decade earlier.
That being said, 41.8% of renters said they stayed put for one to four years. That is up from 39.9% a decade earlier.
"While the fact that people are staying longer in their rentals may mean they can't afford to buy a home in today's market, staying put also means they're saving some money that could eventually go toward a down payment if they do have a goal of homeownership. Staying in the same home means they're likely to face smaller rent increases, and they're saving money on moving costs and application fees. Landlords typically prefer long-term tenants because they don't have to spend money on cleaning and marketing vacant units," Redfin Senior Economist Sheharyar Bokhari said in the report.
Why Renters Are Staying Put
US renters are staying put for a number of reasons. First, renters are now being priced out of homeownership as the median US sale price of houses continues to soar, increasing 6.49% nationally in March for a new record.
Mortgage rates are also elevated near two-decade highs, soaring to 8% in October last year before settling at 7.03% for the 30-year term in the week ending May 30, per data from Freddie Mac.
In addition to higher home prices, asking rental prices for one- and two-bedroom units increased again nationally by 1.2% in May. The going rate for one-bedroom apartments settled at $1,504 while the rate for the two-bedroom apartments settled at $1,865 in May. It is the fastest pace recorded in almost two years.
