Nearly Half of Renters Worry They Won’t Be Able to Buy a Home
The American dream of owning a home appears to be more like a fantasy for many renters, with nearly half worrying that they’ll never be able to buy a home, according to a recent survey from LendingTree.
The survey of 2,050 consumers, conducted by Qualtrics and released last week, found that 48% of renters question whether they’ll ever be able to buy their own place. More than half of Gen Xers (55%) who don’t currently own a home fret that they won’t be able to buy one — the highest percentage of any age group. That’s a pretty grim statistic, considering that some Gen Xers have already reached their mid-50s.
Similarly, more than half (52%) of millennials ages 25 to 40 also fear they won’t be able to buy a home.
The biggest barrier to buying a home is the down payment required, with 54% of renters saying they can’t afford to put enough money down for a mortgage. Other common barriers include high home prices (36%) and difficulty qualifying for a mortgage due to a low credit score (32%).
The LendingTree survey results are largely in line with a similar survey GOBankingRates conducted earlier this summer. In that survey of 500 renters and 500 homeowners over age 18, 27% of respondents said the biggest impediment to buying a house was not being able to afford a down payment. Although that figure is half of the LendingTree percentage, it also should be noted that half of the GOBankingRates respondents already own a home.
The GBR survey also found that more than one-third of renters (35%) have $0 saved for a down payment. Poor credit, low wages and unaffordable home prices were three other popular reasons given for not being able to buy a house.
One thing both surveys agree on is that the vast majority of Americans still want to own a home. GOBankingRates found that nearly 80% of the women and more than 75% of the men want to be homeowners in the future. LendingTree found that 88% of respondents would rather own their home than rent.
For those worried about getting on the right track to home ownership, LendingTree offers these tips:
- Limit your cost-of-living expenses by eating out less often, taking fewer vacations and buying less expensive cars.
- Explore low-down-payment options such as Federal Housing Administration loans for first-time buyers.
- Search for homes you can afford rather than fall in love with homes that would stretch your monthly budget. Better yet, shop for homes below your budget.
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