Did you know that 36% of American households currently rent their home?
*Among households with at least one regular mortgage.
†Including insurance, taxes, and utilities.
There are many factors that go into the affordability of owning homes rather than renting for people. While 72% of renters report wanting to own a home, only 45% of renters are able to afford a home where they live.
There are several factors that go into this affordability, including income. One often overlooked factor is insurance.
The estimated average cost of homeowners insurance per year is $1200 in the U.S. Meanwhile, the average cost for renters insurance in the U.S. is only $180.
The average monthly mortgage costs $1,609, whereas the average monthly rent payment comes in at $1,641 to $2,012, depending on unit size.
While the mortgage payment is less on average than the rent payment, it is important to note that the mortgage is in addition to a down payment. The average down payment on a house is 12%. So, for the average U.S. home price of $408,800, the down payment would cost $49,056.
While monthly mortgage prices are less than monthly rent prices, a home buyer must be able to afford a down payment, which is a significant ($49,056) investment.
Read More: Insurance Statistics
In the graph above, we see that in 2021, rental vacancy rates average 4%-7%. The region with the highest rental vacancy rate is the South, at 7.2%, while the Northeast has the lowest rental vacancy rate, at 4.3%.
In 2020, the homeowner vacancy rate was only 1% in the United States. This is at least 4% lower than the lowest rental vacancy rate of 2020, which was in the West, at 5.1%.
In the under-35 age group, 65% of American households are rented. Meanwhile, in the 65+ age group (senior citizens), 79.3% own a home.
The median age of homebuyers is 47 years old, while the median age of renters is 38 years old.
A whopping 64% of millennials who own homes regret their purchase of a home. Meanwhile, only 33% of baby boomers feel the same way.
Renters and homeowners differ in median income by over $30,000. While renters have a median income of $40,500, homeowners have a median income of $72,615. The homeowner median income is higher than the national median household income, which is $68,703.
Homeowners and renters alike spend over 15% of their income on housing, but how much they actually spend differs by over 13%.
Among homeowners, an average of 16.4% of their income goes to housing costs. This includes mortgage, property taxes and homeowner’s insurance.
Meanwhile, 45% of renters spend over 30% of their household income on housing costs.
7.5% of recipients of Covid stimulus money used the money to pay a mortgage, while 10.3% of Covid stimulus recipients used the funds to pay their rent.
Credit scores also tend to differ among homeowners and renters. Renters have an average credit score of 638. Meanwhile, homeowners’ credit score is 731.
When compared with the rest of the world, the U.S. does not have home ownership rates nearly as high as other developed countries. Let’s take a look at the top ten countries with the highest home ownership rates.
Meanwhile, the home ownership rate in the U.S. sits at 65.4%, nearly 20% lower than the tenth highest rate on the above list (Poland, 83.5%). Why might the U.S. homeownership rate be so much lower?
One possibility is the cost of homes. In Romania, the cost per square meter of housing is only $932.02.
There are several factors that drive homeownership rates amongst the various U.S. states. Let’s look at the rates and see if we notice patterns.
In Alabama, the homeownership rate is 72.5%, beating the national average by 10.5%. Although the rates here are high, they are on the decline; homeownership has declined in Alabama by 5.0% since 2005. Currently, homeownership in Alabama is 0.6% higher than the 15-year average rate.
The Alaska homeownership rate is 63.9%. This is 2.6% below the national average. Homeownership here has decreased 4.1% since 2005. Currently, homeownership in Alaska is 0.8% lower than the 15-year average rate.
The Arizona homeownership rate is 64.5%, 8.1% lower than in 2005, and 1.7% below the national average. Arizona homeownership rates are both below average and on the decline. Currently, homeownership in Arizona is 2.8% lower than the 15-year average rate.
The Arkansas homeownership rate is 63.7%. It has decreased 9.9% since 2005, and is below the national average by 2.9%. Currently, homeownership in Arkansas is 6.0% higher than the 15-year average rate.
Rents are becoming increasingly popular in California. The homeownership rate in California is 54.5%, 16.9% below the national average and on the decline; homeownership in California has decreased 9.3% since 2005. Currently, homeownership in California is 2.5% lower than the 15-year average rate.
The homeownership rate in Colorado sits at 63.6%, 3.0% below the national average. The homeownership rate is decreasing, having been 9.3% higher in 2005. Currently, homeownership in Colorado is 3.7% lower than the 15-year average rate.
The Connecticut homeownership rate is 66.1%, 0.8% higher than the national average. This rate is 8.4% lower than the 2005 Connecticut homeownership rate. Currently, homeownership in Connecticut is 3.0% lower than the 15-year average rate.
The Delaware homeownership rate is well above the national average, at 72.7%. This beats the national average by 10.8%. However, homeownership is decreasing here as well, having been 4.1% in 2005. Currently, homeownership in Delaware is 2.4% lower than the 15-year average rate.
The homeownership rate in Florida is 68.1%, 3.8% above the national average. This number has decreased by 5.9% since 2005. Currently, homeownership in Florida is 0.3% higher than the 15-year average rate.
In Georgia, homeownership is equal to the national average, sitting at 65.6%. This has decreased 6.4% since 2005. Currently, homeownership in Georgia is 0.2% lower than the 15-year average rate.
Hawaii has a homeownership rate of 60.2%. While this is 8.2% below the national average, it has increased by 2.4% since 2005. Currently, homeownership in Hawaii is 2.8% higher than the 15-year average rate.
The Idaho homeownership rate is 70.2%, which is 7.0% above the national average. This rate has decreased by 2.2% since 2005. Currently, homeownership in Idaho is 2.0% lower than the 15-year average rate.
The homeownership rate in Illinois is 67.8%, beating the national average by 3.4%. This rate was 4.4% higher in 2005. Currently, homeownership in Illinois is 0.4% higher than the 15-year average rate.
Homeownership is quite popular in Indiana, with a rate of 74.7%. This is 13.9% above the national average, and the rate has only decreased by 0.4% since 2005. Currently, homeownership in Indiana is 5.0% higher than the 15-year average rate.
Iowa has a homeownership rate of 70.4%, 7.3% above the national average. This number has decreased by 4.0% since 2005. Currently, homeownership in Iowa is 1.0% lower than the 15-year average rate.
The Kansas homeownership rate is 68.9%, which is 5.0% above the national average. In Kansas, homeownership has increased by 0.7% since 2005. Currently, homeownership in Kansas is 2.1% higher than the 15-year average rate.
Kentucky’s homeownership rates sits at 69.8%, 6.4% above the national average. The rate has decreased 2.6% since 2005. Currently, homeownership in Kentucky is 0.1% higher than the 15-year average rate.
The Louisiana homeownership rate is 70.1%, 6.9% above the national average. This represents a decrease of 4.1% since 2005. Currently, homeownership in Louisiana is 2.0% higher than the 15-year average rate.
Maine has an extremely high homeownership rate, at 75.3%. This is 14.8% above the national average. Moreover, the homeownership rate in Maine is increasing; the rate is 2.0% higher than in 2005. Currently, homeownership in Maine is 2.0% higher than the 15-year average rate.
Homeownership rates in Maryland are stable, at 69.6%, 6.1% above the national average. This number is 2.2% lower than in 2005. Currently, homeownership in Maryland is 1.3% higher than the 15-year average rate.
In Massachusetts, the homeownership rate is 62.3%. This is 5.0% below the national average, and has decreased 1.7% since 2005. Currently, homeownership in Massachusetts is 1.6% lower than the 15-year average rate.
Michigan has a homeownership rate of 72.2%, 10.1% above the national average. However, this is in decline; the rate has decreased 5.7% since 2005. Currently, homeownership in Michigan is 3.0% lower than the 15-year average rate.
Minnesota has a high homeownership rate, sitting at 73.4%, 11.9% above the national average. Since 2005, homeownership in Minnesota has decreased 2.9%. Currently, homeownership in Minnesota is 1.3% higher than the 15-year average rate.
Mississippi homeownership has a rate of 71.2%, which is 8.5% above the national average. This has decreased 8.4% since 2005. Currently, homeownership in Mississippi is 4.0% lower than the 15-year average rate.
Missouri homeownership is high and increasing; the rate is currently 71.6%, which is 9.1% above the national average. This is an increase of 0.3% since 2005. Currently, homeownership in Missouri is 1.6% higher than the 15-year average rate.
The Montana homeownership rate is 68.3%. This is 4.1% above the national average, and it has decreased 0.4% since 2005. Currently, homeownership in Montana is 0.1% lower than the 15-year average rate.
The homeownership rate in Nebraska is 67.4%. This number is 2.9% higher than the national average, having decreased 1.7% since 2005. Currently, homeownership in Nebraska is 0.8% lower than the 15-year average rate.
Nevada has a home ownership rate of 58.3%. This is 11.1% below the national average, and it is decreasing; since 2005 home ownership in Nebraska has decreased by 8.6%. Currently, homeownership in Nevada is 1.3% lower than the 15-year average rate.
New Hampshire has a high homeownership rate, sitting at 76.1%, 16.0% above the national average. Since 2005, homeownership in New Hampshire has decreased 1.9%. Currently, homeownership in New Hampshire is 3.3% higher than the 15-year average rate.
New Jersey homeownership is below average; the rate is currently 65.2%, which is 0.6% below the national average. This is a decrease of 7.0% since 2005. Currently, homeownership in New Jersey is 1.0% lower than the 15-year average rate.
The New Mexico homeownership rate is 70.8%. This is 7.9% below the national average, and it has decreased 1.3% since 2005. Currently, homeownership in New Mexico is 2.4% higher than the 15-year average rate.
The homeownership rate in New York is one of the lowest in the U.S., at 54.0%. This number is 17.7% higher than the national average, having decreased 3.6% since 2005. Currently, homeownership in New York is 0.7% higher than the 15-year average rate.
In North Carolina, the homeownership rate is 66.3%. This is 10.7% above the national average, and has decreased 7.4% since 2005. Currently, homeownership in North Carolina is 1.3% lower than the 15-year average rate.
The homeownership rate in North Dakota sits at 61.8%, 5.8% below the national average. The homeownership rate is decreasing, having been 8.0% higher in 2005. Currently, homeownership in North Dakota is 4.1% lower than the 15-year average rate.
The Ohio homeownership rate is 67.9%, which is 3.5% above the national average. In Ohio, homeownership has decreased by 7.5% since 2005. Currently, homeownership in Ohio is 1.9% lower than the 15-year average rate.
The Oklahoma homeownership rate is 68.4%. This is 4.3% above the national average, and it has decreased 5.4% since 2005. Currently, homeownership in Oklahoma is 1.8% lower than the 15-year average rate.
The Oregon homeownership rate is 63.7%, which is 2.9% below the national average. In Oregon, homeownership has decreased by 9.1% since 2005. Currently, homeownership in Oregon is 1.3% lower than the 15-year average rate.
In Pennsylvania, the homeownership rate is 71.3%. This is 5.7% below the national average, and has decreased 3.3% since 2005. Currently, homeownership in Pennsylvania is 0.4% higher than the 15-year average rate.
The homeownership rate in Rhode Island sits at 62.9%, 4.1% below the national average. The homeownership rate is decreasing, having been 1.4% higher in 2005. Currently, homeownership in Rhode Island is 1.3% higher than the 15-year average rate.
The South Carolina homeownership rate is 71.3%, 8.7% higher than the national average. This rate is 3.1% lower than the 2005 Connecticut homeownership rate. Currently, homeownership in South Carolina is 0.9% lower than the 15-year average rate.
The South Dakota homeownership rate is 71.8%, which is 9.5% above the national average. In Kansas, homeownership has increased by 3.2% since 2005. Currently, homeownership in South Dakota is 3.2% lower than the 15-year average rate.
The Tennessee homeownership rate is 67.6%. This is 3.0% above the national average, and it has decreased 5.8% since 2005. Currently, homeownership in Tennessee is 2.1% lower than the 15-year average rate.
The homeownership rate in Texas sits at 64.8%, 1.2% below the national average. The homeownership rate has decreased, having been 1.8% higher in 2005. Currently, homeownership in Texas is 1.2% higher than the 15-year average rate.
In Utah, the homeownership rate is 72.2%. This is 10.1% above the national average, and has decreased 1.1% since 2005. Currently, homeownership in Utah is 0.2% lower than the 15-year average rate.
The Vermont homeownership rate is 73.1%, 11.4% higher than the national average. This rate is 2.3% lower than the 2005 Vermont homeownership rate. Currently, homeownership in Vermont is equal to the 15-year average rate.
The Virginia homeownership rate is 66.5%. This is 1.4% above the national average, and it has decreased 8.7% since 2005. Currently, homeownership in Virginia is 3.7% lower than the 15-year average rate.
The homeownership rate in Washington sits at 62.4%, 4.9% below the national average. The homeownership rate is decreasing, having been 9.8% higher in 2005. Currently, homeownership in Washington is 2.7% lower than the 15-year average rate.
The West Virginia homeownership rate is the highest in the nation, at 78.8%, which is 20.1% above the national average. In West Virginia, homeownership has decreased by 1.4% since 2005. Currently, homeownership in West Virginia is 1.5% higher than the 15-year average rate.
In Wisconsin, the homeownership rate is 70.1%. This is 6.9% above the national average, and has decreased 0.4% since 2005. Currently, homeownership in Wisconsin is 0.8% higher than the 15-year average rate.
The homeownership rate in Wyoming sits at 71.1%, 8.4% above the national average. The homeownership rate is decreasing, having been 4.0% higher in 2005. Currently, homeownership in Wyoming is 1.4% lower than the 15-year average rate.
Different races differ significantly in their homeownership rates in the U.S. Here are the stats on homeownership by race:
The largest gap is between Black and white, non-Hispanic Americans. This gap is over 30%.
Since 1994, homeownership has increased by over six percentage points among both Hispanic or Latino and Asian or Pacific Islander Americans.
Homeownership differs vastly among different age groups. Check out the statistics below for information on different age groups and their home ownership rates.
As is shown above, homeownership increases as age increases.
Older generations tend to be more likely to own homes. In 2019, the generational home ownership rates correlated with the rates of their respective ages. Here are the rates:
The Silent Generation and Baby Boomers have nearly identical homeownership rates, at 77.3%. Generation X has over ten percent less, and millennials exhibit a huge drop in home ownership rate, sitting at 43.3%.
White households have the highest rate of home ownership, at 73.8%. Meanwhile, 53% of Hispanic households and 58% of Black households rent their homes.
Among senior citizens (age 65+), the home ownership rate is 79.3%. The next highest group of home ownership is also the next oldest group, ages 55-64. 75.7% of adults aged 55-64 own their homes.
The trend of age continues even younger than the 55-64 year-old age group. 45 to 54-year-olds have a 69.4% home ownership rate, and 62.0% of 35 to 44-year-olds own a home.
In 2021, the U.S. held over 44.1 million rental households. These made up around 36% of all housing units. 11% of housing units are vacant.
Renting is most prevalent in large cities such as New York. Meanwhile, some suburbs have fewer than one in ten residents as renters.
Many cities have experienced gains in renting homes over recent years. The following is a summary of the U.S. cities with the most renters:
All of these cities have significant renter populations, with the U.S. seeing the most renters today since 1965.
Key Takeaway: Renting is most prevalent in big cities rather than rural areas.
A whopping 20.4 million renters spend over 30% of their household income on rent. 24% pay more than 50% of their income to rent. This does not include the cost of renter's insurance
17.5% of renters live in 2-4 unit buildings. 65% of single family renters are living in 1 or 2 bedroom houses, while 25% live in homes with 3 bedrooms.
Key Takeaway: Renting is becoming more and more popular in the U.S., with many renters spending significant portions of their income on rent.
Rental households are more likely to be single when compared with their home owning counterparts.
16.9 million, 38.3% of renting households are single occupant. Meanwhile, 48.2 million homeowners, which is 61.2%, are married, both spouses being present.
4 million renters are unmarried couples with both partners present and living there.
3.6 million veterans rent their homes. At the same time, 8 million veterans own their homes.
Key Takeaway: Rentals are most common among singles.
Among renters, the median household wealth is $6,270. This is only 5.1% of the median wealth among all households. Black renters have the lowest median household wealth, at $1,830.
Among Hispanic-identifying renters, the median household wealth is $5,800. Among Asian and all other races, the median renter wealth is $6,710.
Key Takeaway: Renting is most common in urban communities, especially among minorities in the U.S.
That is it for this list of statistics on homeowners and renters.
I learned a lot when putting this list together, and I hope you did too.
To see how Worth can reduce your risk.
