While there are many reasons to rent rather than buy, a recent poll suggests that individuals are doing the former more frequently because they don’t have the funds necessary to purchase their own property.
The Federal Reserve Bank of New York recently posed a question to a group of homeowners and renters, asking them to name some of the reasons why they would opt to rent a residence rather than buy. At 56%, the most common response given was not having the requisite amount of savings that’s typically required. Of that total, slightly more than half said that they didn’t make enough money and 41% indicated they didn’t have the proper level or quality of credit.
Andreas Fuster, Basit Zafar and Matthew Cocci, the chief investigators of the analysis, pointed out that based on people’s responses, finances seem to be preventing consumers from buying, specifically those who are new to the working world.
“Weak fundamentals and limited access to credit, rather than a lack of desire to own, are preventing renters from buying,” the researchers wrote in a blog post at the Federal Reserve Bank of New York’s website.
There are also some benefits to renting as opposed to owning, respondents said, some of the main ones being the flexibility that it provides and not having to deal with the type of maintenance that homeowners traditionally need to perform on a regular basis.
Another advantage to this form of living is that renters insurance is usually quite affordable. According to the latest statistics available from the Insurance Information Institute, the average premium for a renters’ policy is about $187, though this amount can vary depending on the state.
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Article From Selective Insurance
