CA Renters Want to Buy a Home, But Face Obstacles

June 10, 2016 by · Leave a Comment 

Nearly half of California renters plan to buy a home in the future, but many are encountering affordability and financial obstacles, according to a survey released Wednesday by the California Association of Realtors.

Forty-eight percent of those surveyed said they plan to buy a house, with 10 percent saying that they plan to buy within a year. For those not planning to buy, an improvement in finances, lower housing prices, and saving enough for a down payment would motivate them to buy now.

Of the 28 percent of renters who said they don’t plan to buy in the future, half said they can’t afford it, 20 percent prefer to rent, 19 percent said they can’t qualify for a mortgage, and 15 percent lack a down payment.

Job uncertainty (9 percent), economic uncertainty (12 percent), and housing market uncertainty (6 percent) were among other reasons renters cited for not buying a home.

One in four millennial renters said they plan to purchase a home that will accommodate their parents, and about one in five millennials indicated they plan to pool funds with family members to buy a home.

Hispanic renters were more likely to buy a home that will accommodate their parents and/or adult children than any other ethnic group, with 46 percent indicating so, compared with 35 percent of blacks, 32 percent of Asians, and 29 percent of whites.

Other key findings from CAR’s “2016 Renter Survey” include:

—Forty-six percent of renters claimed they currently rent because they can’t afford to buy, and 13 percent said they have poor credit and can’t qualify for a loan. The remaining renters choose to rent because they like the flexibility, freedom and ease of renting, are concerned about the maintenance costs of owning a home, or are not interested or aren’t ready to buy.

—Fifteen percent of renters plan to buy a home out of their current area, with 7 percent planning to move to another state, 7 percent to another county in California, and 1 percent to another country.

—Of the renters who are planning to leave the area where they currently reside, 27 percent are moving to find lower housing prices, 24 percent are moving for a better neighborhood, 14 percent want to be closer to family, 9 percent want a shorter commute, and 7 percent are moving for a better school district.

The survey was conducted online to 1,000 renters statewide in March. Complete survey results can be viewed at http://www.car.org/marketdata/surveys.

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