High-Earning Americans Are Now More Likely to Rent Than Buy, a New Report Says
Investing in real estate is one way to build wealth. So why are more high-earning Americans choosing to rent instead of buy?
Rising mortgage rates and high costs have convinced some that homeownership is risky in today’s market, The Wall Street Journal reported. According to the U.S. Census Bureau, the number of households rented by people making $150,000 or more increased to 3 million between 2016 and 2021. For context, that’s an 87 percent spike in a five-year period. RentCafé, who analyzed the data, found that Austin, Texas saw the biggest surge in renters with six-figure incomes, a trend that was fueled by the pandemic. Cities across the Southwest including Nashville, Atlanta, and Phoenix also had more interest from those looking to relocate.
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While inflation may deter some from buying right now, others are simply holding out for something better. Well-heeled renters aren’t willing to just splash their cash on any old home, they’re waiting to splurge on a property that meets their every need. “They really demand what they want, because they’re able to pay for it,” Whitson Huffman, co-chief executive of real-estate investment firm Capital Square, told the Journal.
In the meantime, more affluent individuals are settling in luxury buildings where they can enjoy an array of swanky amenities. A rooftop pool, fitness center, sports court, spa, and screening room are just a few of the perks. Plus, there’s no need to worry about maintenance fees or repair bills.
Renting is also proving attractive to those who want to explore a new city without putting down permanent roots; essentially, it’s less of a long-term commitment. “I know a lot of people who…rent in Manhattan and then in the winter they rent in Miami or maybe they want to rent in Arizona, wherever it may be,” Michael Liebman, vice president of portfolio management at WealthWay Equity, told FOX 5 New York. “You’re seeing a lot of that,” he added. “And these people have the means. They have money, and they can do it.”
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