Redfin: Renter Households Outpace Homeowner Households

(Image courtesy of Redfin; Breakout image courtesy of Max Vakhtbovycn/pexels.com)

The number of renter households grew 2.7% in the third quarter year-over-year, to a record 45.6 million, Redfin, Seattle reported.

In the same period, there was a 0.9% increase in homeowner households, now at a total of 86.9 million.

The growth in renter households marked the second fastest pace since 2015. The only faster rate was set in Q1, at 2.8%.

A renter household is defined as one where the head of the household reports to the Census Bureau that they are renting the property; a homeowner household is one where the head of household reports they own the property.

The median asking rent grew 0.6% year-over-year in September, and home prices grew 6% year-over-year during the month.

The boom in multifamily housing construction may also be propelling the popularity of renting. In Q3, new multifamily housing units were being added at an annual rate of 647,000, the fastest pace dating back to 1994.

“With home prices at record highs and mortgage rates remaining elevated, renting is increasingly the only viable choice for many young people and families,” said Redfin Senior Economist Sheharyar Bokhari. “Building more homes will help address that, but we also have to recognize that Gen Z and future generations may not view homeownership as a life goal and the rentership rate may continue to rise for years to come.”