Top 10 reasons renters keep renting

NEW YORK – Nov. 3, 2014 – Most Americans who don't currently own their home say they intend to one day, and they hold strong feelings toward home ownership.

But about 20 percent of renter households are adamant about renting, and they say they intend to stay renters now and in the future, according to researchers at Harvard's Joint Center for Housing Studies (JCHS). The Center recently surveyed renters to find out why they're shying away from what some consider the "American dream."

The bottom line: It's not lifestyle choices but financial constraints that renters say keep them from purchasing a home in the future. More than half said they do not intend to buy because they think they cannot afford it, or their credit is not good enough, according to JCHS.

According to the research, the top 10 reasons renters give for not planning to buy in the future:

• Cannot afford the purchase or upkeep of a home

• Not good enough credit for a mortgage

• Not a good time economically to buy a home

• Cheaper per month to rent than to buy

• Don't want to be concerned with doing the upkeep

• Don't plan to be in a certain area for an extended period of time

• Rather use the money for other investments than a home

• Process of buying a home seems too complicated

• Purchasing a home limits flexibility in future choices

• Can live in better neighborhood by renting

"These results suggest that about a third of renters, or 10 percent of all households, rent because of lifestyle and personal preferences," writes Rachel Bogardus Drew, a post-doctoral fellow conducting the research for JCHS. "That their reasons appear to be largely idiosyncratic, rather than systematically related to their personal characteristics, further indicates that those who rent by choice do so in spite of strong social biases towards ownership that encourage the remaining 90 percent of households to view owning favorably."

However, many renters could become homeowners under the right circumstances.

"More than half of lifetime renters … see their tenure options as constrained, either by their own financial circumstances or by macroeconomic conditions," says Drew.

Source: "Who Doesn't Want To Own a Home?" Harvard Joint Center for Housing Studies' Housing Perspectives blog (Oct. 28, 2014)