Five to six million new renter households may be created within the next 10 years, likely caused from low inventories of homes available and tight credit conditions, according to the Bipartisan Policy Center.
Rental demand is expected to particularly increase among seniors looking to downsize their homes, as well as young adults and a growing immigrant population.
“We expect to see an increase in household formation and for a variety of reasons that household formation is likely to be more heavily concentrated among renters and households who are likely to be renters for somewhat longer than was the case for the last 20 years,” Barry Zigas, director of Housing Policy for Consumer Federation of America, told HousingWire.
Tight credit conditions continues to be one main culprit holding back home ownership among some potential buyers.
“Credit for home ownership borrowing will likely be tighter and potentially more expensive, relative to earlier times,” Zigas predicts. “Families will likely have less wealth because the rising generation is starting with less wealth. If down payments are at any significant level, it will be a barrier to acquiring a home for longer than may have been the case in the past.”
Source: “Small Housing Inventory May Push Rental Demand for Years,” HousingWire