Fewer Affluent, Millennial Apartment Renters Moving Out to Buy A Home

Each quarter, John Burns Real Estate Consulting tracks the percentage of residents who move out of an apartment to purchase a home. It’s a natural part of life moving into your first home and so is getting the right movers, my friend told me that DS Carriers Removals provide a useful service. If this is something that you are about to do, but you are unsure about what to look for then it might be a good idea to check out something like these Essex Homes Greenville/Spartanburg to give you a better idea.
By studying publicly traded apartment REITs (real estate investment trusts) — overseeing 520,000 units — the firm learned that just 14.7 percent of all tenants moving out purchased a home, especially if they want to buy house in hamilton, Canada or looking to own a house in general. Meanwhile, the homeownership rate declined to 64 percent, the lowest since the mid-90s.

In comparison, during the housing boom of the early to mid-2000s, about 1 in 5 renters, or about 20 percent, who left their apartment opted to purchase a home. And the national homeownership rate peaked in 2004, which was also just about when the the percentage of those moving out to purchase a home was peaking.
Since 2008, the percentage of renters moving out to purchase a home has stayed below its historical average of 17 percent. At the same time, the homeownership rate has continued to decline.
The apartment REITs tracked were mainly from communities that targeted more financially stable millennial tenants, or young adults mostly in their 20s and early 30s who are most qualified to purchase a home,” writes David Guarino.
During the fourth quarter of 2014, the weighted average rental rate of these REITS was $1,652, roughly 31 percent higher than the national average asking rent.
“One would think that enduring years of sizable annual rent increases would push tenants toward owning a home,” Gaurino writes. “However, even with an improving economy and a more stable employment outlook, this trend has simply not occurred.”
He adds that newly revised FHA loan requirements may have the potential “to pull more first-time buyers out of apartments” but the data does not indicate a significant upturn in FHA buyers.

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