Americans Renovating Rentals as Housing Market Precludes Purchases
New York, NY, December 1, 2022-"Many Americans unable to buy a home right now are renovating their rentals instead,” reports the Wall Street Journal.
“Resigned to stay in place until the housing market improves and unwilling to live with dull décor, renters are swapping out fixtures, landscaping terraces and ordering custom furnishings. Online furniture retailer Wayfair Inc. said bookings for easily reversible add-on services like installing new doorknobs and drawer pulls have tripled since last year.
“The return on these investments is likely zero, but renters say not owning a house shouldn’t prevent them from having a place that feels like home.
“‘My mind-set is that I’m living now and want to enjoy now,’ said Dinah Eke, a 37-year-old pharmaceutical project manager who shares a rental apartment with her husband and three children in New York City and posts renter-friendly DIY tutorials on social media.
“Nesting renters are one indicator that the housing market is at or near a peak, said Ken Johnson, a Florida Atlantic University economics professor who studies housing and rental markets.
“‘It makes no financial sense to invest in a property you are renting,’ he said. ‘What’s driving this is that it’s incredibly expensive to switch from renting to owning.’
“In September, the cost of buying a single-family home in the U.S. was $888 more a month than renting one, according to John Burns Real Estate Consulting. Confidence in the U.S. housing market hit a new low earlier in November with 16% of Americans indicating that they felt it was a good time to buy a home, according to the Fannie Mae sentiment survey. Lease-renewal rates also reached an all-time high last year, according to real-estate research firm RealPage.”