These wealthy renters could easily afford to become homeowners, but rather they don’t.
For most Americans, economic reasons prevent them from purchasing real estate. But among the very wealthy elite, for whom money is little object, there is a growing preference for renting instead of buying.
Over the past 15 years, the number of households in the top 5% of net worth households has nearly doubled to 5%, according to the Wall Street Journal, based on the Federal Reserve’s Consumer Finance Survey It’s getting closer.
One of the reasons why renting has become a new attraction for the wealthy elite is high interest rates. Dariusz Jarzabek – Stock.adobe.com Unlike owning, renting rarely has the same maintenance costs. Bull Run – Stock.adobe.com
More recently, between 2018 and 2022, the number of households with incomes of $750,000 or more choosing to rent increased to 10.5%, compared to 8.4% five years ago. The media also based their decision on census data.
Billionaires hold off on purchases for a variety of reasons, from high interest rates to a lack of available housing inventory to not wanting to be responsible for maintenance issues.
“This is a funny conversation we have with a lot of our clients. They say, ‘Wow, I have so much money and I can’t afford a house. I can’t find it.” a team specializing in luxury goods told the Journal.
Many millionaires are disappointed with the housing inventory currently available. Michael – Stock.adobe.com
“In terms of price-to-value, the supply is close to zero,” says billionaire fintech startup founder George Gougnin of his disappointment with the current offering of luxury real estate, which currently costs $19,000 a month. is renting three buildings in Manhattan. bedroom unit.
In the case of biotech executive Arun Das and his wife, they were able to find a spot they liked, a historic five-bedroom Philadelphia property on Rittenhouse Square, but the extensive renovations required Unexpected expenses arise and delays occur.
As a result, they ultimately sold their tenement house and instead opted to rent a high-rise building in the area.
“We gradually began to realize the magnitude of the challenge ahead, not just in terms of financial resources, but just time and effort and coordination,” Das said of the renovation work. “The time you save in your day is time you can spend with your kids and have a glass of wine together.”
