States Where the Most People Rent Their Homes
A little over one-third of U.S. households rent their homes. While many associate homeownership with economic stability, renting is often a safer choice, granting more flexibility. At the same time, in cities across much of the country, for a large share of residents, particularly young ones, renting is the only financially feasible choice.
To determine the states with the highest rental rates, 24/7 Wall St. reviewed five-year estimates of the share of housing units that are occupied by renters from the U.S. Census Bureau’s 2020 American Community Survey.
Young people are far more likely to rent homes than buy. Well over half of all renters in the United States are under the age of 45, whereas that age group accounts for just one-quarter of homeowners. According to the census, 45.7% of Americans are under the age of 35. In Maine and West Virginia, which have the two lowest rental rates in the country, 38.7% and 40.8% of residents are under 35, the third smallest and smallest shares in the country, respectively.
Renting has some distinct financial benefits and drawbacks. Renters are not tied long-term to a property, and as such are safe from the risk of defaulting on a mortgage or losing a substantial share of their equity if the housing market tanks, as many homeowners experienced firsthand during the 2007 bursting of the housing bubble leading to the Great Recession.
On the other hand, renters are afforded less regulatory protection, and in high-demand and low-inventory markets like the current U.S. rental market, many landlords are hiking rents and tenants must pay larger and larger shares of their incomes.
In states where a higher share of houses are rental units, properties tend to be less affordable than in states with fewer renters. Hawaii, Nevada, California, and New York, which have the four highest rental rates, all rank among the 10 least affordable rental markets.
Click here to see the states where the most people rent their homes
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