SEATTLE, Nov. 14, 2019 /PRNewswire/ -- As rents
continue to steadily rise across the U.S., about a quarter of
rentersi say affording their rent payments is difficult
or very difficult. To make ends meet, two-thirds of those renters
make at least one financial sacrifice to afford their home, and
half wouldn't be able to afford an unexpected $1,000 expense, according to the 2019
Zillow® Group Consumer Housing Trends Report.
Discretionary spending on leisure activities is the most likely
to go – spending on entertainment was cut by 38% of renters, making
it the top response. Supplementing income is the next most common
course of action, especially for younger renters. A quarter of all
renters pick up a second job or more hours at their current
job.
With affordability challenges growing in much of the country –
renters typically spend a larger share of their income on rent than
they did a year ago in 28 of the 35 biggest markets in the U.S. –
42% of renters said that they ended up in a location outside of the
area they initially considered. The most common reason was not
being able to afford homes in their preferred neighborhood.
Younger renters more often make sacrifices than their older
counterparts. Three-quarters of Generation Z renters and 69% of
millennial renters make at least one sacrifice, higher than the 60%
of Generation X renters and 53% of baby boomer and silent
generation renters who report the same.
Renters who are burdened with debt are much more likely than
those without debt to make at least one financial sacrifice – 73%
of those with debt do so compared to half of those without. More
than two-thirds of renters have some type of debt, including 32%
with student debt, and about a quarter of renters say debt has
caused them to be denied a rental agreement at some point.
"Renting a home in the U.S. is a tale of two renters," said
Zillow Economist Kathryn Coursolle.
"Renting provides an ideal lifestyle for many who value the freedom
to move more easily as life changes and want to be free from the
burden of maintenance responsibilities. But there's another group
that wants to own a home and views renting as a temporary state
until they can make the transition to homeownership. Amid the high
home price growth of the past decade or so, saving for a down
payment is a struggle for many renters that are making real
sacrifices just to make rent each month, and in some cases are one
minor setback away from falling behind."
About half of renters (49%) feel they are about maxed out
financially and say they would not be able to afford an unexpected
$1,000 expense, well above the 20% of
homeowners who said the same. Renters report feeling more stretched
as they get older – 62% of baby boomer and silent generation
renters would not be able to afford this expense, while 40% of Gen
Z and 46% of millennial renters would not be able to.
Parents with children in the home more often make sacrifices
than renters without children. They are more likely to pick up
additional work (28%), reduce monthly payments for technology
services like a cell phone or cable plan (23%), and cut savings
towards a down payment (13%), college savings (9%) or insurance
coverage (7%).
Despite making more sacrifices than their peers in other age
groups, only 18% of Gen Z renters say affording their rent is
difficult or very difficult – around 30% of all other age groups
say the same. This may be because 20% of Gen Z renters are helped
with their rent by parents or another family member.
The 2019 Zillow Group Report on Consumer Housing Trends is the
4th annual largest-ever survey of U.S. home buyers,
sellers, owners and renters, and asked 13,000 U.S. household
decision makers aged 18 and older about their homes – how they
search for them, pay for them, maintain and improve them, and what
aspirations and challenges drive their decision. Data from the full
report is available for free to the public
at www.zillow.com/report, and custom analyses are available to
journalists by emailing press@zillow.com.
Financial
Sacrifice Buyers
Made
|
All
Renters
|
Generation
Z (ages 18-24)
|
Millennials (ages
25-
39)
|
Generation
X (ages 40-54)
|
Boomers +
Silent
Generation (ages 55+)
|
Picked up additional
work
|
25%
|
30%
|
28%
|
22%
|
13%
|
Reduced or
eliminated
saving for retirement
|
11%
|
13%
|
12%
|
8%
|
10%
|
Added a roommate
or
subletter
|
5%
|
8%
|
5%
|
6%
|
3%
|
Postponed or
cancelled
upcoming vacation plans
|
16%
|
12%
|
16%
|
17%
|
18%
|
Postponed or
cancelled
upcoming health services
|
9%
|
8%
|
10%
|
8%
|
8%
|
Reduced or
eliminated
college savings
|
7%
|
10%
|
8%
|
5%
|
1%
|
Reduced or
cancelled
insurance coverage
|
6%
|
7%
|
7%
|
6%
|
5%
|
Reduced monthly
payments or cancelled
technology or
communication services
|
20%
|
20%
|
22%
|
21%
|
16%
|
Reduced spending
on
entertainment
|
38%
|
37%
|
39%
|
36%
|
39%
|
Reduced or
eliminated
savings towards a down
payment
|
12%
|
10%
|
14%
|
11%
|
8%
|
Made a different
sacrifice
|
3%
|
3%
|
3%
|
3%
|
6%
|
Didn't make any
sacrifices
|
34%
|
25%
|
31%
|
40%
|
47%
|
About Zillow
Zillow® is transforming how people buy,
sell, rent and finance homes by creating seamless real estate
transactions for today's on-demand consumer. Zillow is the leading
real estate and rental marketplace and a trusted source for data,
inspiration and knowledge among both consumers and real estate
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Zillow's proprietary data, technology and industry partnerships
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experience, helping consumers search for and get into their new
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mortgage pre-approvals and financing. Zillow Premier Agent
instantly connects buyers and sellers with its network of real
estate professionals to help guide them through the home shopping
process. For renters, Zillow's innovations are streamlining the way
people search, tour, apply and pay rent for leased
properties.
In addition to Zillow.com, Zillow operates the most popular
suite of mobile real estate apps, with more than two dozen apps
across all major platforms. Launched in 2006, Zillow is owned and
operated by Zillow Group, Inc. (NASDAQ:Z and ZG) and headquartered
in Seattle.
Zillow and Zillow Offers are registered trademarks of Zillow,
Inc.
i Renters refer to households that moved in the past
year and rent their home.
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SOURCE Zillow