Owning vs. Renting? American Views May Be Shifting

Even millionaires who could afford to buy are opting to sign a lease instead
By John Johnson,  Newser Staff
Posted Sep 21, 2024 8:00 AM CDT
Owning vs. Renting? American Views May Be Shifting
Stock image.   (Getty / peterschreiber.media)

Soaring home prices have left many Americans of ordinary means out of the picture when it comes to real estate. But a Wall Street Journal story finds that more millionaires are choosing renting over owning as well:

  • The share of households with incomes above $750,000 that rent rose to 10.5% between 2018 and 2022, the highest since the University of Minnesota began tracking the data in the 2000s.
  • The share of renters among the top 5% of households in terms of net worth has doubled to about 5% over the last 15 years.

The reasons are varied. For example, some interviewed say they can invest their money more wisely elsewhere rather than in a residence. The story also notes that even some of the richest homebuyers prefer taking out a loan rather than paying cash, for tax purposes, and high interest rates have made it too painful. And there's just plain math: It's now cheaper to rent than buy in the nation's 50 biggest metro areas, according to Bankrate. All in all, the spike in "millionaire renters signals a broad recalibration in the way some Americans think about homeownership," per the Journal.

A previous story at CNBC interviewed a 39-year-old millionaire who opts to rent and says it makes sense both financially and personally, the latter because of the more hassle-free and mobile life she's able to lead. "Many people still ask me why I'm renting when I can afford to buy a place, but I've learned to stop justifying it to others with different values," says Bernadette Joy, CEO of Crush Your Money Goals. "So the last time I was asked, I simply responded: 'I'm happy where I am.'" An analysis at Yahoo Finance also takes note of the millionaire trend and lays out how it might make sense for the middle class, too. "Homeownership has long been tied to the American Dream," per the story, "but that thinking could be changing." (More millionaires stories.)

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