Eight out of 10 renters use online resources in their search, and most reach out to at least five landlords or property managers in the process of searching for their new place, according to a new report on home buying and renting from Zillow.
The typical renter contacts five property managers or landlords, takes three home tours and submits three applications for a rental.
Nearly half of all renters consider living in a single-family home, but less than one-third actually do, a factor that may contribute to renters’ interest in homeownership, the report says.
While single-family homes are considered by about half, fewer than three in 10 end up in this type of home. More than half of all tenants live in multiunit dwellings with fewer than 50 residences,
a housing category which includes smaller apartment buildings, townhouses, condominiums or a unit within a duplex/triplex property.
And 51% of tenants look for small or mid-sized multifamily units.
Large-Building Renters Also Place Importance On:
- Management company reviews (48 percent), especially those living in larger buildings (62 percent).
- Large-building renters are also more interested in floor plans (68 percent)
- Consumer reviews of a building (69 percent).
Renters in the West are looking for small to medium-sized apartment buildings, the report says.
Finding a new rental takes an average of 10.4 weeks – and up to 12 weeks for those with lower household incomes.
Renters Expect Quick Action from Landlords
More than 20 percent of renters will give up on a property if they don’t receive a response to their inquiry in what they consider to be a timely manner, which for most is within 24 hours, according to the report.
Tenants typically sign leases with a length of 12 months. They prioritize finding a place that fits within their budget, is in a safe neighborhood, and takes their pets, sacrificing other features such as square footage, a yard, garage or view in favor of a home they can afford in their desired location.
Renters are disproportionately female (57 percent) and people of color (48 percent), and 58 percent earn less than $50,000 a year. They are also younger than homeowners—84 percent are under 50.
- While looking for a rental, 58 percent consider buying a home instead.
- Forty-eight percent consider a single-family house, but only 28 percent lease one.
- Renters spend an average of 10.4 weeks searching for a home, and they typically contact five landlords or property managers and submit three applications.
- Renters’ top priorities are finding a home in their budget, living in a safe neighborhood, and finding a place that accepts pets.
Median Monthly Rent
The median monthly rent in the U.S. is $872 a month, but it varies by region.
- $1,100 in the West
- $800 in the Southeast
- $1,000 in the Northeast
- $715 in the Midwest
- $875 in the Southwest
Thirty-five percent of tenants who have not moved within the last year have no plans to move.
Renters are defined as people who moved to a home that they rent within the last year, which includes the main decision-makers and other household members who had a say in the decision.
Today’s typical person who rents is most often female (57 percent), Caucasian (52 percent) and part of a household earning below $50,000 annually (58 percent). Eighty-four percent are below age 50, making them Millennials (56 percent) or members of Generation X (28 percent).
- Millennials represent more than half of all renters (56 percent), and they are often women (59 percent), more likely than older generations to be Latino/Hispanic (23 percent), and include adults across all income levels.
- Generation X represents approximately one out of three renters (29 percent). This generation is balanced by gender (47 percent male versus 53 percent female) and more likely to be black/African American (21 percent) than other generations. Nearly a third (29 percent) earn above $75,000 a year, representing the highest proportion of wealthier renters among the generations.
- Sixty-one percent of Baby Boomers who rent are women, most bring in below $50,000 (61 percent), and most are Caucasian (66 percent).
- Silent Generation tenants are balanced by gender (49 percent male/51 percent female) and are most often Caucasian (72 percent) or black/African-American (17 percent). Nearly three out of four (72 percent) are living on household incomes below $50,000, suggesting they are drawing on Social Security or a fixed retirement income.
In terms of household composition:
- Six in 10 (59 percent) are living with a spouse/partner
- four in 10 have children under the age of 18.
- One in three renters has at least one pet (35 percent), comprised primarily of cats (16 percent), small dogs (15 percent) and medium/large dogs (12 percent).
Like buyers, those who rent have a first choice – a single-family home (48 percent). However, consideration of stand-alone houses is less pronounced than that of buyers (83 percent).
More than half (51 percent) of renters are looking at units in small or mid-sized buildings, and about one-third (32 percent) consider townhouses.
Tenants also consider larger buildings with more than 50 units (30 percent), duplex/triplex units (24 percent) or a condo/co-op (17 percent). Just 7 percent are considering applying to live in income-restricted rental housing.
Many Generational Trends Exist
When Considering Types of Rental Homes:
- Millennials are most willing to move into apartment buildings of any type—large, medium-sized, and small—or into townhouses.
- Generation X renters are most interested in single-family home rentals (54 percent) but are also open to living in apartment buildings.
- Baby Boomers are the population most likely to consider living in a duplex or triplex (26 percent).
- Silent Generation renters are more likely to consider “other” housing (19 percent), possibly because some senior housing doesn’t fit conventional rental parameters, or to rent income-restricted properties (12 percent) as many live on fixed incomes in retirement.
Renters in the West Interested in Small
To Medium-Sized Apartment Buildings
Regionally, renters in the Southeast and Midwest seek the space afforded by single-family homes, while renters in the expensive and dense Northeast and West look to smaller buildings, sharing a home, or income-restricted options to make the rent more affordable.
- Those in the Southwest appear to seek the amenities of larger rental communities.
- Northeast – they are among those most likely to seek out small apartment buildings (58 percent) or to rent a room in a shared home (10 percent).
- Southeast – they seek space, and are among the most interested in single-family homes (53 percent) or townhouses (35 percent).
- Midwest – they show the most interest in duplex/ triplex housing (29 percent). They are also among the most interested in single-family homes (50 percent) and smaller apartment buildings (41 percent).
- Southwest – they are the most interested in larger apartment communities (35 percent) or renting a condo or co-op (20 percent).
- Western – they express considerable interest in small to medium-sized apartment buildings (53 percent), a condo or co-op (20 percent), or economizing by living in a room in a shared home (10 percent) or in an income-restricted property (9 percent).
Rental Selection and Leasing Factors
Like buyers, renters take in-person tours of properties. They also must reach out to property owners or managers and submit their application (with credit score, income and employment status) while working against the clock.
- As with buyers, renters don’t often seal the deal on their first attempt. The typical renter contacts five property managers or landlords, takes three home tours and submits three applications for a rental.
- The younger the renter, the more effort is typically expended, with Millennial renters contacting more property managers (around five). Silent Generation renters reach out to fewer property representatives, take fewer home tours (typically one) and submit fewer rental applications (one to two, on average).
- To evaluate prospective properties, four out of five renters (82 percent) place importance on taking in-person home tours to get a sense of the space – this is especially important for those with children (86 percent).
- The majority, (82 percent) also want to know lease terms and rules before committing, and many want to meet rental management – especially if renting a single-family home from a landlord (64 percent). Renters also place importance on management company reviews (48 percent), especially those living in larger buildings (62 percent). Large-building renters are also more interested in floor plans (68 percent) and consumer reviews of a building (69 percent).
Reprinted with permission of Rental Housing Journal. For more information, visit www.rentalhousingjournal.com.