New research shows that two out of three American renters have considered moving to a cheaper location because of the current economic climate.
In fact, a similar percentage of people believe they will never become homeowners for this reason.
Seventy-four percent of 2,000 renters surveyed in November said they were worried about the state of the economy, and seven in 10 said their income was not enough to pay rent, bills and household items.
This reason may explain why half of respondents are in debt to their landlords – and it doesn’t help that 61% have seen their rent increase in the past year.
Given these financial constraints, survey respondents suggested that an average of 31 percent of income should go toward monthly rent payments and 35 percent toward other expenses and needs.
However, 69% hope that their economic situation will improve in 2023.
According to the results of the survey conducted by the insurance company Lemonade and OnePoll found that 57% of respondents said inflation influenced their rental decisions.
65% of tenants in this category had to look for houses with the cheapest rent; 60% reduced the size of their apartment or house; 57% tried to negotiate an acceptable price with the landlord.
However, 65% believe that the rental market will continue to grow after COVID.
When asked what the benefits of renting are, most renters cited not having to worry about property taxes (69%); flexibility to live anywhere (66%); and not having to worry about maintenance fees (59%).
Respondents also listed disadvantages of renting, such as dealing with a bad landlord (62%); rent increase (61%); and not being able to make changes to their rental property (60%).
“Between the cost of rent, the lack of inventory and the mass migration we’ve seen during the pandemic, the rental market has changed dramatically across the country in the last few years,” said Sean Burgess, chief operating officer of Lemonade. in the statement. .
“And while we are starting to see prices settle in the market and return to traditional movement trends, rising inflation and general recession fears will keep this turmoil going for some time to come.”
The survey also asked respondents to describe their lease status, with 53 percent saying they signed a new lease during the pandemic.
In that period, 73 percent of those who signed a new tenancy agreement said it was a “sweetheart deal,” or an informal agreement between them and their landlord.
No wonder 84% now regret signing up with those sweethearts in the first place. Many respondents also understand that these informal agreements do not protect them as tenants; it is temporary; and it offers them no stability.
However, 64% believe that the home they are renting is worth the money they are paying.
“Now more than ever, renters are paying more than they expected in their monthly rent, so what better time than now to protect yourself from further financial burdens?” Burgess added.
“This is where renters insurance can play a big role in protecting not only what’s in their home, but themselves as well. For example, if someone’s apartment is rendered unlivable by fire or someone is injured in their home, they are covered by their insurance policy if they are responsible. Ultimately, this could save you hundreds, if not thousands, of dollars in unexpected expenses.”