Renting is increasingly popular in the suburbs as homeownership becomes less attainable for many, according to a Point2Homes analysis. From 2018 to 2023, the percentage of renters rose by at least 5 points in 11 of 20 suburbs around major U.S. metro areas, with 15 suburbs transitioning from majority homeowners to majority renters. Key areas experiencing this shift include rapidly growing Sun Belt cities like Dallas and Miami, alongside Northeastern cities such as Boston and Philadelphia. Notably, Dallas suburbs have seen a 17.6% increase in renters, surpassing the 7.9% rise in the city itself.
The affordability of home buying has plummeted nationwide, amplified by rising mortgage rates, which currently hover around 7%, the highest since before the 2008 financial crisis. For many, the financial burden of buying a home is prohibitive. For instance, renters like Mark and Andrew Decker expressed frustration at the high costs of homes, with Mark stating that comparable properties would increase his monthly payments by 30%. Building mixed-use developments known as “suburban downtowns” aims to cater to the new demographic of suburban renters.
Tara Raghuveer of the Tenant Union Federation highlights the potential negative consequences of this suburban rental boom, suggesting that it may marginalize residents by pushing them away from urban amenities and resources. Conversely, landlords argue that renting offers financial predictability and reduced maintenance burdens. As remote work endures, suburban living has gained appeal, potentially sustaining higher living costs in these areas, complicating the housing market ahead. Economists anticipate that the contrasting dynamics between suburban and urban living will evolve, impacting pricing and availability in the near future.
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