Only 30% Of Renters Who Moved In The Last Two Years Became Homeowners, New Study Shows
A new study has revealed why Americans are moving - and where they're moving to. The results seem to show a housing market that remains somewhat healthy - and certainly isn't indicative of an economy in deep depression.
For the study, Rocket Mortgage "analyzed the latest data from the 2021 American Housing Survey (AHS) to explore Americans’ moving motivations and processes" and a recent mover was defined as "anyone who moved into their home within 2 years of the survey time, as categorized by the U.S. Census Bureau."
They found that 36% of people who had moved wanted to stay in the same city, but just relocate to a new neighborhood. 32% of respondents said they wanted to move to a different city altogether.
30% of those who moved became homeowners, the study showed.
The analysis revealed that 26% of renters who transitioned to homeownership reported a decrease in their housing expenses, highlighting an additional advantage of relocating.
For an individual who transitions from renting an apartment at a monthly cost of $1,900 to owning a home with a monthly mortgage payment of $1,400, the financial benefits are significant, with potential savings of $500 monthly. This equates to an annual saving of $6,000. However, it's important to consider that owning a home incurs additional costs not typically associated with renting, such as closing costs, insurance, and expenses related to home maintenance and landscaping, they wrote.
Then, another big question: why are people moving? The study showed that "39% of people who moved did so to upgrade to a larger or better-quality home, while 35% of movers wanted to be in a more desirable neighborhood."
These aren't exactly trends suggesting that consumers are in dire straits just yet. Only 18% of movers moved to reduce housing costs.
The study also looked at how people were finding new places to live. Upon deciding to relocate, individuals often proceed to explore numerous housing options. There are several methods potential homebuyers use to discover homes for sale, such as:
Searching through real estate websites
Collaborating with a real estate agent
Touring various neighborhoods in person
Receiving recommendations from colleagues, friends, and family
"According to the AHS, 51% of homeowners found their home by talking with a real estate agent, while 42% found their home by browsing homes online. With real estate agents acting as a guiding light for current homeowners, these numbers support the idea that an agent’s expertise is a necessity when house shopping begins," the study says.
Click through to view the full Rocket Mortgage study.
