New Survey Finds 65 Percent of Homeowners Now Look Favorably Upon Renting Over Owning
Concerns over erratic housing market, rising foreclosures, and
uncertain mortgage rates reflect change in consumer attitudes, NAA finds
Arlington, VA, May 21, 2007 – A new survey commissioned by the National Apartment Association finds that an erratic housing market in the U.S., marked by uncertainty over mortgage rates and concerns about rising foreclosures, indicates that many homeowners are seeing renting an apartment in a more favorable light than they may have in the past.
The independent survey of more than 2,100 U.S. homeowners[1], conducted by leading market research firm Harris Interactive®, finds that 65 percent of homeowners believe that, given the current state of the real estate market, there are advantages to renting as opposed to owning.
“This survey reflects a notable contrast to what we traditionally see,” said National Apartment Association (NAA) President Douglas Culkin. “In the past, people who own their homes have generally seen renting an apartment as a stepping stone to homeownership. That phenomenon has by no means disappeared, but, across the nation, we’re seeing more and more consumers opting to rent, instead of own.”
Among the key advantages of renting versus owning, homeowners cited:
▪ No susceptibility to foreclosure (25 percent)
▪ Not being impacted by an unpredictable real estate resale market (23 percent)
▪ No fluctuating interest rates (23 percent)
Only 54 percent of homeowners cited the inability to build equity if renting as a major concern about apartment or condominium living. Interestingly, a larger proportion of homeowners (62 percent) cited potential lack of privacy as a more serious consideration.
“There’s been a lot of discussion of the economic fallout of sub-prime mortgage lending that happened over the last few years,” said NAA’s Culkin. “However, little attention has been paid to how the crisis has affected current homeowners’ views of homeownership as an investment choice.”
“Make no mistake, these things are cyclical,” said Culkin. “However, this survey reflects an interesting view of how homeowners value their home equity — and in our industry, we don’t see this changing anytime soon.”
Adding to the complexity of the issue is the fact that homeowners who have lost, or may soon lose, their homes to foreclosure are now facing the added difficulty of failing to qualify as creditworthy apartment renters.
In an effort to help these “born-again renters,” NAA, in collaboration with the National Multi Housing Council, is “proactively engaged in finding ways to address the growing credit problem and assist consumers in getting into apartment homes. There are a lot of people out there who need help,” said Culkin. “We want to do all we can to help them.”
About the survey
This survey was conducted online within the United States by Harris Interactive on behalf of the National Apartment Association between April 26 and April 30, 2007 among 2,118 adults (aged 18 and over) who own a house, townhouse, condominium, or cooperative apartment. Figures for region, age within gender, education, household income and race/ethnicity were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents’ propensity to be online.
With a pure probability sample of 2,118, one could say with a ninety-five percent probability that the overall results would have a sampling error of +/- 3 percentage points. Sampling error for data based on sub-samples may be higher and would vary. However, that does not take other sources of error into account. This online survey is not based on a probability sample and therefore no theoretical sampling error can be calculated.
About Harris Interactive
Harris Interactive is the 12th largest and fastest-growing market research firm in the world. The company provides innovative research, insights and strategic advice to help its clients make more confident decisions which lead to measurable and enduring improvements in performance. Harris Interactive is widely known for The Harris Poll, one of the longest running, independent opinion polls and for pioneering online market research methods. The company has built what it believes to be the world’s largest panel of survey respondents, the Harris Poll Online. Harris Interactive serves clients worldwide through its United States, Europe and Asia offices, its wholly-owned subsidiaries Novatris in France and MediaTransfer AG in Germany, and through a global network of independent market research firms. More information about Harris Interactive may be obtained at www.harrisinteractive.com.
About the National Apartment Association
One-third of the homes in America are apartment homes and many of these homes are represented by the National Apartment Association, America's leading advocate for quality rental housing which represents more than 6.1 million apartment homes throughout the United States and Canada. The organization's mission is to serve the interests of multifamily housing owners, managers, developers and suppliers and maintain a high level of professionalism in the multifamily housing industry. For information please visit www.naahq.org.
[1] For the purposes of this survey, “homeowners” were defined as U.S. adults ages 18+ who own a house, townhouse, condominium, or cooperative apartment (n= 2,118).