Renters who opt for single-family homes over apartments are more likely to live in those homes for five years or longer and more interested in ultimately becoming a homeowner, according to a study released Monday.
Some 26% of single-family-home renters said they planned to live in their current rental for five years or more, compared with 22% for renters in multifamily buildings. Three out of every five single-family renters also said they planned to become a homeowner within five years, compared with just 44% of apartment renters.
More than 14 million renters live in single-family homes in the U.S., but over the past year the sector has received much more attention from private-equity funds and other institutional investors looking to build large pools of rental homes by purchasing foreclosures and other distressed properties at fire-sale prices.
While some critics have questioned the ability of these firms to effectively manage hundreds or thousands of single-family homes scattered across a city, the lower turnover of single-family tenants could help reduce costs for landlords.
The survey, conducted by ORC International for Premier Property Management, also found that a majority of apartment and single-family renters indicated that they rent because they enjoy the lifestyle, and not because they’re unable to get a mortgage. Less than one third of renters cited an inability to get a mortgage as the reason they won’t become a homeowner within five years.
Compared with apartment tenants, tenants of single-family homes are twice as likely to have kids. They also tend to have higher median household incomes and value neighborhood amenities such as good schools and parks more than apartment dwellers.
ORC conducted the survey of 1,006 adults between Jan. 10 and Jan. 13.