Major investors are buying more housing because they expect to gain from rising rents and escalating house prices, creating a growing class of renters in America.
Bloomberg reported on remarks made by Barry Sternlicht, chairman of the real estate investment firm Starwood Capital Group, at a recent event.
“You’re seeing a squeeze and now they’ll have to rent because they can’t afford to buy,” Sternlicht said in an interview Friday at Bloomberg Power Players Miami.
Bloomberg reported:
That benefits landlords like Starwood, which Sternlicht said owns 100,000 apartments and 15,000 rental houses.
An inflationary environment also helps commercial real estate owners by increasing the costs of building new supply, increasing the value of existing properties.
Sternlicht said he’s bullish on red and purple states with pro-business governments, including Florida, Tennessee and Texas. His company continues to buy more rental units, he said, targeting areas “where affordability is still OK.”
According to the iPropertyManagement website, housing statistics were reported on last month. Statistics included:
• Homeowner vs. renter statistics reflect a decline in homeownership, with 35 percent of American households renting their home.
• In the last financial quarter of 2021, the nationwide homeownership rate was 65.5 percent, a 0.5 percent decline year-over-year (YoY).
• 44.1 million households rent their homes.
• The median household wealth among homeowners is 3,965 percent higher than it is among renters.
• Excluding home equity, household wealth among homeowners is 1,469 percent higher than it is among renters.
• Renters are 89.9 percent more likely than homeowners to be behind on housing payments (rent vs. mortgage payments).
• The renter:owner ratio is 50.1 percent, its lowest since 2010 (49.56 percent).
• Historically, the lowest renter:owner ratio was 44.9 percent in 2004.
• The renter:owner ratio hit its 182.1 percent historic high in 2019.
• Among military veterans, the renter:owner ratio is 45.0 percent. The median household wealth among renters is $6,270 or 5.1 percent of the median wealth among all households.
• The median household wealth among homeowners is $254,900 or 109 percent higher than the median household income among all households.
The statistics also reveal which U.S. cities have the most renters, with the Top 10, in order: Waterbury, Connecticut (60.8 percent); Springfield, Missouri (59.1 percent); Fayetteville, North Carolina (56.4 percent); Birmingham, Alabama (56.2 percent); Yonkers, New York (54.9 precent); Irvine, California (54.3 percent); Lowell, Massachusetts (53.3 percent); Downey, California (53.2 percent); Bolder, Colorado (53.2 percent); Fargo, North Dakota (52.9 percent).
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