Are we becoming a nation of majority tenants?

By Morf Morford

Tacoma Daily Index

The rapid increase in housing costs has had at least one very predictable consequence; more and more of us, active or not, are semi-permanently excluded from the homeownership equation.

Rising home equity has been a boon to homeowners, while renters have been marginalized in the financial dynamics of the housing market.

As a result, not only are more potential buyers relegated to renting, but more communities are statistically becoming majority tenants.

Nationally, the number of renters increased by 22% – which means around 21 million people living in rentals.

In King County, White Center is the only subway suburb to have reached the majority of renters in the past decade, reaching 51%.

As recently as 2010, this community was still landlord territory, even though 48% of its residents lived in a rented place.

SeaTac will almost certainly go from owner to majority tenant over the next several years. In 2019, the suburb was poised to become a hub for tenants, with 49% of its residents renting out their homes.

The city of Tacoma is going in pretty much the same direction; according to the city’s own records, roughly half of us in Tacoma are homeowners.

In 2000, the homeownership rate was 51.7%. In 2010, it was 49.3%. In 2021, it was 52.9%.

The number of renters in Tacoma is stable (from 2000 to 2021) at around 40%.

Oddly enough, the vacancy rate is stable at just under 10%. In 2000 the vacancy rate was 6.1%, in 2010 it was 8.4% and in 2021 7.5%.

In no economic system is this increasingly bifurcated economy a good sign.

Some commentators describe any society as filled with invisible ‘conveyor belts’ – systems that underpin every economy and that pull, almost always without any deliberate action or motivation, like gravity or magnetism, each of us along. of a life trajectory. .

We have no choice, after all, about our parents, and the multitude of choices they made that, for better or for worse, we are forced to live with.

Did your parents own property? College graduates? Single parents? Addict ?

Whatever they are, it is extremely likely that you too will get carried away by the currents that they have set up for you.

One of the most obvious of these “conveyor belts” is renting or owning a home. For most of us, homeownership is at the heart of personal and certainly generational wealth – or at least financial stability.

Renting is a “choice” – often the only choice – for many.

But if you’re looking for an immediately understandable example of this “conveyor belt” concept, housing would be it.

Homeowners are seeing their equity increase month after month (at least in recent years).

“Equity” of course means value – or, for tenants in particular, cost.

As the “value” increases for homeowners, the “cost” increases for tenants.

In other words, when it comes to economic equity, for homeowners, the financial “treadmill” goes up. For tenants, it goes down.

But for everyone involved – tenants, landlords and real estate professionals among many others, the most important foundation of all – stability – is long gone.

And more and more Americans (as well as many Britons and Europeans) find themselves further and further away from property.

A home is more than a shelter – it’s where and how we define ourselves.

This is where we welcome others into our lives.

This is where we discover, revel and share.

As the French philosopher Gaston Bachelard wrote: “A house shelters reverie, a house protects the dreamer, a house allows us to dream in peace.

And more and more of us are denied this place to “dream in peace”.

An estimated 2.1 million people were behind on their mortgage payments as of March 2021. For people who haven’t yet bought a home, mortgage payments are growing much faster than income. In July 2021, median home prices were up 23% from a year ago, while incomes were up just 3%.

As always, the “treadmill” pulls some people up and some people down.

Homeownership is, as we have all been told, and most of us believed, the centerpiece of the “American Dream”.

Owning your own home is a foundation of neighborhoods, connection and care, in a practical way, for the place where you live and belong.

Home ownership presupposes and is based on stable income and relationships.

A threat to one of them undermines them all.

The rental is, by definition, temporary, even transitory.

Homeownership is comparatively semi-permanent.

Home office has a whole new meaning in 2021

Working from home has changed careers, commuting and even the commercial real estate market.

Offices are being transformed into housing at a record pace in 2021.

Working from home not only convinces home owners to convert living space into office space, but also convinces office building owners to convert their currently (and possibly permanently) unused office space into office space. life.

Almost all cities have hundreds, if not thousands of potential homes available on a relatively short notice.

This will tip the balance towards even more tenants in our urban centers.

For more rental details across America take a look here – turned-renter-majority -this-decade /.

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