Why the Rich Keep Renting

March 12th, 2014 by The JetSetter Team | 1 Comment »

JS0301For so long, we’ve been led to believe that if we have the capacity to buy a house, we should. This idea that the American Dream can only be achieved through home ownership is long persisting—but perhaps it is no longer correct. It turns out that there is a large market (experiencing continued expansion) for high end rentals, and wealthy individuals and families are more often turning to luxury rentals.

Why might this be?

Availability
As the economy experienced setback, the value of real estate took a massive hit, which caused many would-be sellers to hang onto their properties for a little bit longer. While waiting for housing prices to rebound, these owners have begun renting their properties out, a concept Jason Hartman is very familiar with. This means an increased number of high end rentals are on the market (properties that were formerly unavailable) and people are taking an interest.

People who may have purchased an expensive home are now able to rent a home of similar quality while they check out the neighborhood, renovate, or look for a home that is 100% perfect. And the owners are finding that they’re passively making money—a win-win!

Convenience
Another reason high income individuals are renting is simply the convenience. World travelers often prefer to rent, as maintaining a variety of homes across the world can be expensive, tricky, and troublesome.

The rich are willing to pay a higher price tag for the convenience of having someone else take care of the dirty work—these rentals sacrifice nothing over owning a home but are much easier to deal with.

Time
Thanks to the economy, buyers are experiencing little urgency when it comes to locking in a mortgage. People are taking more time to think about their major purchases, and a luxury home is major.

Renters are also saving time by renting—no home maintenance means more free time to do with as you choose.

Unpredictability
Home values edging downward have caused homeowners and those who would be homeowners to move slowly when it comes to large purchases. When the economy experiences a shakeup, people tend to keep their money close—and renting means you’re only parting with a bit each month. This setup is more comfortable for a lot of people, no matter the income bracket. Many individuals are now renting the home or homes they own out to others, and renting the space they live in from someone else. ‘Tis the age of the renter! (photo credit: Photo Phiend via photopin cc)

* Read more from Jetsetter

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The Jetsetter Show Team

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