Renters extend tenancies as housing affordability crisis deepens
Renters are less likely to pick up and move than they were a decade ago, as soaring housing costs have priced many out of homeownership.
One in six renters (16.6%) stayed in their home for 10 years or more in 2022, up from 13.9% in 2012, according to Redfin, citing data from the Census Bureau. Another 16.4% lived in their rental for five to nine years last year, compared to 14% a decade earlier.
“The uptick in tenure is beneficial for renters and their landlords,” said Redfin senior economist Sheharyar Bokhari. “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.”
The analysis pointed to several factors driving the trend of renters hunkering down. Home prices have more than doubled since 2012, while mortgage rates have soared, making homeownership increasingly unaffordable. Rental costs have also jumped over 20% since 2019.
At the same time, the rise of remote work has enabled some to embrace renting as a lifestyle choice without being tied to one location. A persistent housing shortage means that even those who can afford to buy a house struggle to find properties.
“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.”
Read more: Have homebuyer affordability conditions improved?
Over 40% remained in their home for only one to four years in 2022, while one-quarter moved within 12 months - though that figure is down from 32.2% in 2012.
Bokhari said that renter tenure will likely decline soon. An apartment-building boom in 2023 gave renters more places to move and cooled rental-price growth.
The analysis also found generational gaps, with over half of Gen Z renters staying 12 months or less compared to just 13.3% of baby boomers.
“There are several reasons young renters move a lot,” Redfin said in the report. “Many adult Gen Zers are in college or in the early stages of their career, life stages that often beget moves. They also have more flexibility because they’re less likely than millennials and Gen Xers to have children living at home. Additionally, many Gen Zers and millennials move out of rentals into the first home they purchase.”
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