The current housing market is characterized by elevated mortgage rates and historical home prices, prompting an increase in the number of renting households to over 44 million in the U.S. This trend reflects the growing challenges of homeownership, particularly among Millennials who are now seeking more space due to family growth. Consequently, demand for single-family rentals has surged, indicating a shift in housing preferences amid economic constraints.
The national median mortgage payment reached $2,256 in April, and hidden costs such as maintenance, taxes, and insurance can add roughly $1,500 to monthly expenses, making homeownership increasingly unattainable. As a result, many prospective buyers are opting to rent. The asking rent for single-family homes has averaged $2,262, illustrating that while renting is becoming mainstream, it also presents its own financial challenges for the average household.
The demand for single-family rentals has surged, with significant growth in the build-to-rent sector. About 18,000 built-for-rent homes began construction in the first quarter of 2024, a notable 20% increase from previous years. The shift in demographic preferences and economic conditions is driving this trend, as more families seek larger rental spaces amidst rising housing prices and limited affordability in home purchases.
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