Renters Are More Likely to Face Financial Hardships than Homeowners
November 7, 2018
Low inventories and higher interest rates are making it harder for Americans to become homeowners, but a new study reveals that those who opt to rent instead are more likely to face financial stress.
The study, conducted by the Urban Institute, found that renters were more likely to face material hardships, meaning they had trouble paying for either housing, utilities, food or medical care. Even when accounting for socioeconomic differences like age, employment and income, the study showed that 46 percent of renters had had difficulty paying for at least one basic need in the last 12 months, compared to 36 percent of homeowners.
Renters also have less financial security than homeowners, making them less able to deal with unexpected costs. More than one-quarter of renters did not feel confident that they could cover a $400 emergency. Only 18 percent of homeowners felt the same way.