A new report from the government-sponsored lending group Freddie Mac suggests that demand from renters for living spaces will continue rising over the next few years. Officials from the organization cited continued economic stress, lower average income and a desire for personal mobility as reasons that more people will opt to rent before buying a home.
Freddie Mac, in its study, created several scenarios based on government data related to economic improvement. The most realistic possibility suggests that less-than-stellar growth figures will lead to 1.7 million new renters between now and 2015. Under the most optimistic forecast, more people will seek to own homes but roughly 1 million prospective renters will still enter the market.
According to the report, the national homeowner rate declined from 68.2 percent to 65.5 percent, suggesting that this trend began even before the Great Recession severely impacted home equity levels. Of the potential outcomes created by Freddie Mac, this figure could drop to as low as 64 percent before 2015. Under those circumstances, a rental market buoyed by high demand and low availability would see even more competition.
"The economic data indicates that current rental markets are very strong with low vacancy rates, rising rents and solid demographic trends," David Brickman, Freddie Mac's vice president of its multifamily property division, was quoted as saying in a press statement. "What this research demonstrates is that these conditions are likely to remain in place for several years to come."
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