Americans Think Renting is Cheaper than Buying

As rents flatten and home prices rise, Americans seeing leasing as a better deal.

A large majority of Americans, 78 percent, believe renting is more affordable than owning a home, according to new data from Freddie Mac.

That is an 11-percentage point increase from six months ago, according to the Wall Street Journal’s Laura Kusisto.

“The survey also indicates that demand for for-sale housing could remain soft in the coming months,” Kusisto writes. “Some 58 percent of renters now say they don’t currently have plans to buy a home—up from 54 percent in February, according to Freddie.”

In the past couple of years, higher rents combined with lower home prices pushed people to start considering home ownership after the for-sale market cratered during the recession. But things seem to be shifting back to rentals.

“Rent growth has slowed in line with inflation in the last few quarters, as new rental supply hits a three-decade high,” Kusisto writes. “At the same time, home prices continue to grow significantly faster than incomes and inflation and mortgage rates have risen nearly a percentage point from the beginning of this year. That has made it significantly more expensive to buy a home.