CHERRY HILL, N.J., Oct. 21, 2015 /PRNewswire/ -- As rents continue to rise, many renters are considering a shift to homeownership soon. According to a new survey released by TD Bank, America's Most Convenient Bank®, 50 percent of consumers who currently rent are likely to purchase a home within the next two years, and many have already taken steps toward homeownership, such as saving for a down payment.
The TD Bank Renter Survey polled more than 1,000 Americans currently renting apartments or homes, asking how they feel about homeownership, what concerns might be keeping them out of the housing market and what factors are motivating them to consider home purchases.
The findings reveal that higher rents are directly connected to consideration of homeownership.
The Renting Landscape
A growing proportion of today's renters are reaching the breaking point and considering home ownership.
- According to the survey, the breaking point at which renters claim they would contemplate buying a home is when rent rises over $1,100; Renters reported that the average monthly rent is close to $1,000 per month, meaning they are approximately $100 away from reaching that breaking point
- Over half of respondents have experienced a significant rent increase, with average rents increasing by nearly $300 over the past two years.
Almost half of renters considering homeownership are concerned with the costs associated with financing a home purchase.
- Fifty-one percent of respondents said money is their main concern when purchasing a home, stating that they have not saved enough money or they have too much debt to afford a home right now.
- Forty-eight percent of respondents cite concerns about the affordability of mortgage payments.
- The two biggest motivators cited for purchasing a home include rising rents and the desire to build equity.
"Rising rents are motivating Americans to purchase a home," said Scott Haymore, Head of Pricing and Secondary Markets. "With an improving job market and economy, renters are gaining more confidence in the housing market and starting to explore homeownership as a feasible option."
Purchasing the American Dream
The American Dream of homeownership appears to be alive and well.
- Fifty-nine percent of consumers said it's extremely or very important to own a home.
- Millennials place even higher importance on homeownership, with 76 percent rating home ownership extremely or very important to them.
- On average, renters have been able to save more than $50,000 toward a future home purchase.
- Twenty-four percent of millennials have saved $100,000 or more toward a home.
"We can see from our data that rents are rising, and while many renters feel that saving for a home is out of reach, there are other options they should consider," said Haymore. "Today, potential buyers can take advantage of state and government affordability programs, which offer options outside the traditional 20 percent down payment. This enables them to pursue homeownership, build equity and still feel comfortable with their monthly payments."
Additional highlights from the TD Bank Renter Survey are available at http://mediaroom.tdbank.com/rentersurvey.
The study was conducted from September 23 – September 30, 2015 among a nationally representative group of consumers who currently rent homes or apartments. The sample size of 1,046 has a margin of error of +/- 3.0 percent. Data has been weighted by age, gender and region to reflect the population. The survey was hosted by Vision Critical.
About Vision Critical
Vision Critical provides a cloud-based customer intelligence platform that helps companies build engaged, secure communities of customers they can use continuously, across the enterprise, for ongoing, real-time feedback and insight.
About TD Bank, America's Most Convenient Bank®
TD Bank, America's Most Convenient Bank, is one of the 10 largest banks in the U.S., providing more than 8 million customers with a full range of retail, small business and commercial banking products and services at approximately 1,300 convenient locations throughout the Northeast, Mid-Atlantic, Metro D.C., the Carolinas and Florida. In addition, TD Bank and its subsidiaries offer customized private banking and wealth management services through TD Wealth®, and vehicle financing and dealer commercial services through TD Auto Finance. TD Bank is headquartered in Cherry Hill, N.J. To learn more, visit www.tdbank.com. Find TD Bank on Facebook at www.facebook.com/TDBank and on Twitter at www.twitter.com/TDBank_US.
TD Bank, America's Most Convenient Bank, is a member of TD Bank Group and a subsidiary of The Toronto-Dominion Bank of Toronto, Canada, a top 10 financial services company in North America. The Toronto-Dominion Bank trades on the New York and Toronto stock exchanges under the ticker symbol "TD". To learn more, visit www.td.com.
SOURCE TD Bank