2 Executive Summary Home ownership is highly desirable among renters; Nearly three-quarters of those surveyed rated home ownership as important. More than half of renters said they plan to buy a home in the future, as nearly all see advantages in owning versus renting. Buying a home is still viewed as a good investment Nearly all renters (96 percent) saw advantages in homeownership; with main advantage being building equity for their future and their children s future. Almost 80 percent of renters younger than 35 years of age expect to buy a home in the future. Two of three renters age 35 to 44 are expecting to buy a home in the future. The majority, over 7 out of 10 renters, intend to wait at least three years before buying a home. Most renters rent out of financial necessity; and plan to buy in the next three years or longer. For renters who are not planning on buying a home in the future, the majority claimed that they could not afford it. Affordable home prices would motivate one in five renters to buy a home. Almost 27 percent of renters would be motivated by some reason which includes financial consideration, including improvement in their credit and downpayment assistance. Three main disadvantages of renting; lack of equity, inability to make decorative changes, and unpredictable rent increases. The majority of respondents prefer single family homes over condominiums, townhomes and other types of residences. When they are ready to buy, nearly half of renters (47 percent) intend to begin their search online and most plan to use a REALTOR. 74 percent of those that say they will begin their search online also say they plan to use a REALTOR. The younger group is more likely than other groups to ask for input from family and friends. The majority (56 percent) of these potential home-owners will use a REALTOR to make their home purchase. The majority will purchase in the same county or neighborhood where they currently reside. Nearly one-fourth of all renters (23 percent) have student loan debt. Majority of those with student debt (78 percent) have less than $10,000 of outstanding student loans. Among online respondents to the survey, 33 percent indicated having outstanding student loans, with 84 percent averaging less than $10,000 of student loan debt.
3 Renters as Future Home Buyers Recovering housing market has been accompanied with increased values of homes, but also higher mortgage interest rates. Consequent higher housing costs led to diminishing housing affordability for many Californians who are at increasing rate deciding to rent instead of buy. In October 2013, the state median price of a single family detached home was $427,290, a 25.3 percent increase from October 2012. Due to the increasing cost of purchasing a home, sales in 2013 have dropped state wide by 11 percent from the year before (CALIFORNIA ASSOCIATION OF REALTORS, 2013). Additionally, median household income has not risen in the aftermath of the economic recession. According to the CALIFORNIA ASSOCIATION OF REALTORS Housing Affordability Index, only 32 percent of Californians can afford to buy a home, and the index has been on a continuous decline from 56 percent in the first quarter of 2012 (CALIFORNIA ASSOCIATION OF REALTORS(R), 2013). Gen Y has been disproportionally affected by the economic recession and is partial towards renting. Amounting to an estimated population of about 3-5 million people, Gen Y have been waiting out a bad economy and are just now looking to rent a place of their own. This pent-up demand is twice as big as any past demand for rentals in American history. Of course, with a large increase in demand and limited supply, rent prices have been rising nationally at a rate of four percent annually and 7-9 percent in some metropolitan areas. Threequarters of this age group would want to own a home if they could afford it (Yonder, 2012). However, as many surveys on renters have shown, renters are paying high rent prices rather than purchasing a home out of financial necessity, not a choice. More than seven out of every 10 renters agree that owning a home is important, nearly half (49%) of the renters surveyed rate the importance of home ownership as very important. The median rating was eight, on a scale of one to 10, with 10 being extremely important. Figure 1: Importance of Home Ownership (Scale: 1-10, 10=Extremely ) 30% 25% Telephone Online All 20% 15% 10% 5% 0% 1 2 3 4 5 6 7 8 9 10
4 Couples with children and Hispanic renters are much more likely to feel strongly about the importance of home ownership. Hispanics demographics gave an average ranking of 7.8 while couples with children demonstrated a close level of importance with 7.6. Homeownership is also seen as more important in Southern California than Northern California (7 v. 6.3 on average). Despite the housing crisis, buying a home is still viewed as a good investment. Both online and telephone respondents have generally not changed their opinion of home buying as being a good investment. Nearly all renters (96 percent) saw advantages in home ownership. While almost half of all respondents believed that gaining equity and investing for their future and their children s future was an advantage of homeownership, online respondents were twice as likely to mention those reasons. Online respondents were also three times as likely to believe in freedom gained from homeownership and were twice as likely to take pride and feel satisfaction from owning something of their own. Renters also mentioned the following advantages of owning a home: 47% Equity/Inv estment for future/ children 44% freedom/ control 35% 26% privacy pride of security ownership stability 24% tax deductions 20% more space The majority of renters (52 percent) expect to buy a home. Recent renters, who started renting after 2007, are even more likely to plan to buy a home (63 percent). Gen Y renters are nearly twice as likely to buy a home as Baby Boomers. Almost 80 percent of renters younger than 35 years of age expect to buy a home in the future. Renters age 35 to 44 are also largely expecting to buy a home in the future with 2 out 3 indicating so. Telephone respondents are more stationary and are less likely to move in the near future, while more than one-third (35 percent) of online respondents plan to move within the next couple of years. Earned income, certainly, plays a large role in renters expectation to be able to buy a home and consequently, those with higher incomes are more likely to plan on a purchase. Figure 2: Renters Who Expect to Buy a Home 5 78% 78% 67% 40% 44% 57% 59% 57% 24% 9% Total <25 25-34 35-44 45-54 55-64 65+ <$35K $35K - $50K - $75K+ $49k $74k Age Annual Income
5 For renters who are not planning on buying a home in the future, the majority claimed that they could not afford it. Other reasons mentioned generally included preference for renting, uncertainty around economic and housing market conditions, lack of down payment and other financial reasons. Figure 3: Reasons for Not Planning to Buy a Home Can't Afford to Buy Prefer to Rent Economic Uncertainty Lack of Down Payment Renting is Less Expensive Job Uncertainty Don't Know Housing Market Uncertainty 3% 3% 7% 6% 6% 14% 41% While not being able to afford to buy a home is a driving reason for renting, renters identified some other reasons why they choose to rent instead of buying, includind inability to obtain a mortgage (9 percent), and general unreadiness for homeownership. Nevertheless, only about a fifth of renters like renting. Most often, renters dislike not being able to build equity, not having control or freedom to make changes, and unpredictable rent increases. One in ten renters indicated that having no sense of ownership is what they disliked about renting. Figure 4: Reasons for Renting Instead of Buying Can't afford to buy Poor credit / Can't qualify Renting is easier Young/Starting out/not ready Flexibility/Freedom if renting Cost/Upkeep/Responsibility Plan to / Saving for down Never considered it/no interest Disabled/On disability 9% 6% 6% 6% 5% 5% 3% 44%
6 Figure 5: What Renters Dislike about Renting No equity/money wasted/no investment 24% No control/no freedom/ Can t make changes 14% Rent: paying, high, increases, increases unpredictable 15% No sense of ownership / It s not mine 10% Neighbor issues (except noise) 6% Property not maintained / No or slow maintenance 5% Landlord/Management Issues 3% Lack of privacy 3% Rules / Restrictions / Inspections 4% Other: 13% Although optimistic, renters are not in a hurry to buy. The majority, over 7 out of 10 renters, intend to wait at least three years before buying a home. Waiting this long will allow them to save money for a down payment and work on improving their ability to afford to buy. Most renters plan to buy a single family home (77 percent) while others want a townhouse, condominium or mobile home. The majority plan to stay local; 14 percent plan to buy in the same neighborhood and 41 percent intend to stay within the same county. Only 10 percent of renters indicated they intend to buy in another state. Figure 6: Where Potential Buyers Plan to Buy Same neighborhood as current residence Same County where currently reside In another County in California In another State In another Country Don't Know When asked what would motivate renters to buy a home, there were a variety of answers. Affordable home prices would motivate one in five renter to buy a home. Some would get motivated by starting their own family (17 percent). Generally, almost 27 percent of renters would be motivated by some reason which includes financial consideration, including improvement in their credit and downpayment assistance.
7 Figure 7: What would most motivate you to buy a home? House Price: Affordable, Low, Reasonable 22.5% Don t Know 3. For Kids or Family / When Starting a Family 16.5% My Own Place / Independence / 2.5% Freedom If My Credit Improves 11.5% Help for First Time Buyers 2.1% Nothing 8.8% Low/Lower Interest Rates 1.7% Money / Improved Finances / More Stable 6% Better paying job / Raise / Getting a 1.6% Situation Good Job If I Win the Lottery / Windfall 5.6% If the Economy Improves 1% Having Money for Down Payment 4. Assistance with Down Payment 0.9% Right Location or Neighborhood 3.6% Other 0.9% Greater Privacy 3.6% More Space/Room / Backyard 0.5% Finding the Perfect House 3. The Investment / More Stability (for family) 0.3% Some of the respondents who are currently renters have owned real estate or currently own real estate. Twenty six percent of renters have owned or still own real estate, with older respondents and those with higher incomes and more education generally more likely to have done so. Overall, more of them sold for family or work reasons than for financial ones. However, among those that sold after 2007, the main reasons for selling were short sales and foreclosures. For many, beginning to look for a home will begin by going online. Online searching is a way to explore the market and find out what is available at what price. It doesn t appear to replace seeing a REALTOR, as 74 percent of those that say they will begin their search online also say they plan to use a REALTOR. In fact, online searching for homes may be an effective way for prospective buyers to find a realtor. Age is a factor in how prospective buyers will first begin searching, with those under age 35 most likely to start the search online (40 percent). Twenty one percent of them will start with a REALTOR, and another 22 percent will ask family and friends. The younger group is more likely than other groups to ask for input from family and friends. Renters 35-44 years of age are most likely to start by searching online (48 percent), while almost the same share of those 45-54 year olds (43 percent) will start with online search as well. Those 55 years of age and older are equally likely to search online or see a REALTOR (35 percent both). Lastly, retirees are most likely to start by seeing a REALTOR (38 percent). The majority (56 percent) of these potential home-owners will use a REALTOR to make their home purchase. Overall, renters have a positive or neutral impression of REALTORS. Fourteen percent listed positive descriptions as the first word that comes to mind about REALTORS such as helpful, knowledgeable and professional.
8 Who is the 2013 Renter? The demographic profile of renters California is very diverse. Women make up slightly more than half of the rental market at 54 percent. This closely resembles home buyers, of which 53 percent are female (CALIFORNIA ASSOCIATION OF REALTORS, 2013). About one in three renters belong to the Gen Y group--younger than 35; one in five are Gen X- -between the ages of 35 and 45; and 45 percent are Baby Boomers 45 or older. The typical renter is 42 years of age, six years older than their buyer counterparts, who are typically 36 years of age. The demographic profiles of the two sets of respondents telephone and online--varied some, with the most significant difference being their age. The median age of online respondents was 39, compared to 45 years of age for telephone respondents. The average household size consists of two adults and 1.8 children. Nearly half of renters (45 percent) do not have children. Of those who do have children, 38 percent are single parents six out of 10 single parents are female. The majority of renters are single (58 percent). This is much higher than for home buyers, of which 37 percent are single (CALIFORNIA ASSOCIATION OF REALTORS, 2013). The fact that most renters are single is not surprising. Generally, renters need less space, making an apartment dwelling more suitable than a single family residence, and also do not have a double income, making a bigger residence less affordable. The majority of renters do not have a college education, only 36 percent have a four-year college or graduate degree. Home owners, on the other hand, are more likely to have a college degree, with 61 percent holding a degree. Lower likelihood of college education among renters is also reflected in their annual household income which is lower to that of buyers. Most renters (63 percent) have an annual household income below $75,000, compared to only three percent of buyers. The overwhelming majority of buyers (97 percent) have an income above $75,000. Nearly one-fourth of all renters (23 percent) have student loan debt. Majority of those with student debt (78 percent) have less than $10,000 of outstanding student loans. Half of renters do not have other types of debt that would make it difficult to buy a home, twenty-six percent have credit card debt, nine percent have auto loans, and the remainder or respondents has private, personal or other kind of debt. Among online respondents to the survey, 33 percent indicated having outstanding student loans,
9 with 84 percent averaging less than $10,000 of student loan debt. Fourteen percent of telephone respondents had outstanding debt, with 17 percent owing more than $50,000. Figure 8: Student Loan Debt Student Loan Debt Amount of Debt <$10K 78% Refused $10-$20K 8% No 75% $20-$50K 6% Yes 23% $50-$100K 3% > $100K Refused Figure 9: Ethnicity by Age Black Asian White Hispanic Other 6% 9% 8% 5% 8% 7% 13% 29% 21% 38% 49% 6 73% 75% 15% 1 7% 4% 5% 1 9% 10% 11% 10% <35 35-44 45-54 55-64 65+ Age
10 More than half of renters (54 percent) are white, 18 percent are Hispanic, 11 percent are black, 10 percent are Asian and the remaining seven percent are of some other ethnic background or combination of ethnicities. This differs from home buyers where minorities make up 63 percent of the buyer population. Current Residence Renters generally do not move frequently, with the median tenure being five years. Eight out of 10 renters have been in their current residence more than two years, and about half have not moved in over five years. Forty-three percent of respondents indicated that they intend to occupy their current residence for at least two more years, with 22 percent claiming they will stay put more than five years. The average renter intends to remain in their current home for 4.6 more years, compared to 5.5 years for the average home buyer. The majority of renters (51 percent) live in apartments, while 27 percent live in a single family home, and 22 percent in a townhouse, condominium or other dwelling. Most rentals include two bedrooms (71 percent) and one bathroom (56 percent). The average monthly rent is $1,160, varying by the size of the residence ranging from $984 per month for a one bedroom, to $1,445 per month for a four bedroom. The average rent price includes only basic amenities for most renters, such as parking, water and trash collection. Other amenities: Sewer, Appliances, Recycling, Pool, Storage Space, Secured Entrance 48% 48% 38% 28% 27% 2
Frequency California Association of REALTORS 2013 Renter Survey 11 With most renters claiming to have lived in their current residence for an average of over four years, their monthly rent expenses remained rather constant. One in three renters did see increases in their rent either upon renewal of their annual lease (27 percent) or their monthly lease (six percent). Of the respondents whose rent has increased since they moved in, the majority, 27 percent said the increase happens at their annual lease renewal. This is much more common for those who lease apartments, 29% of which have had a rent increase at this time, compared to the 7% of house renters who have experienced this. It is also much more common for those who deal with a management company, at 3, than those who deal with the owner, 15%. Next to annual renewals, only 6% of renters say their rent increases on a monthly basis. The median rent increase was two percent with 77 percent of respondents claiming that their rent increased by four percent or less. 2.3 percent of respondents, however, reported quite dramatic increases of more than 20 percent and 7.2 percent of renters saw increases between 10 and 20 percent in their rent. The demographic that experienced the greatest rent increase was the group of renters who pay less than $700 monthly. This group had an average increase of 5.4% to their rent with a median of 3%. 46 percent of renters also said that their rent has not increased since they moved in. Predictably, renters who recently moved in were more likely to give this answer. 78% of renters who moved in within the past 2 years, 55% of renters who moved 3-5 years ago, 3 of those who moved 6-10 years ago, 18% of those who moved 11-20 years ago, and finally 16% of renters that moved in over 20 years ago have not had their rent increased since they moved in. Interestingly, people who rented single family homes were much more likely to say their rent has not increased (63%), meanwhile 36% of apartment dwellers say they have had their rent increased since they moved in. Figure 10: Amount of Most Recent Rent Increase 45% 40% 41.1% 35% 30% 25% 20% 15% 16.5% 12.6% 10% 5% 6.8% 4.9% 2.6% 2. 2.5% 1.4% 2.5% 2.9% 1.8% 2.3% 0% % Rent Increase With higher rent, there are generally more amenities included in the monthly rent. This is particularly the case for recreational amenities. Of those that pay $1,500 or more, 34% have a pool, 25% have a barbeque, 2 have an exercise facility, 21% have a Jacuzzi, 17% have a club house, 6% have basketball courts, and 9% have tennis courts. There are also large regional differences in what comes included in
12 rent. Renters in Northern California are more likely to have recycling, at 65%. Renters in Southern California are more likely to have other types of amenities. 67% have parking, 31% have a pool, and 15% have a Jacuzzi. In other areas of California, only 14% have a secured entrance, 9% have an exercise facility, and 8% have a club house. The majority of renters selected their current home for the reasonable rent (30 percent) or for the neighborhood (22 percent). The remainder mentioned amenities, being near work or family, the size of the residence, having privacy, the school district or being near shopping. Renters also rated reasonable rent price and the neighborhood as the most important characteristics in selecting their home. The least important characteristics were related to school, which is reflective of most renters being single and not having children. Figure 11: Importance of Specific Characteristics in Selecting Rental (Scale: 1-10, 10=Most important) Reasonable Rent Price The Neighborhood Near Shopping Amenities Near Work Allows Pets Near Park/Outdoor Activities Near Restaurants Near Family Near Public Transportation The School District Near Children's School Near Your School 5.5 5.3 4.9 6.9 6.7 6.6 6.3 6.3 6.2 6.2 6.1 8.1 8.6 For renters who are sensitive to rent expenses, reasonable rent is a very important factor. Out of the respondents that pay $700 or less, 6 rated reasonable rent as 10 for importance (on the scale 1 to 10) and the average rating was 8.9. For those that pay between $701 and $1,000, 59% rated this factor as a 10 and the average ranking was 9. For the price range $1,001-$1,500, 50% ranked a 10 and the average was 8.6. Finally, for those that pay over $1,500 in rent, 43% ranked reasonable rent at 10 and the average was 8.1. Reasonable rent is also more important for those looking for an apartment than for those seeking to rent a house (8.7 v. 8.6). Reasonable rent is also the least important to Asian renters who ranked this factor at 8.2 on average. Regionally, it is the least important to Northern California renters (8.2), followed by the Southern California renters (8.7), and finally to renters in other parts of California (8.9). The geographic trend is similar to the costliness of rent and annual income. For instance,
13 Northern California is the most expensive and has the lowest ranking of importance for reasonable rent and the highest income on average. The survey asked respondents what they dislike most about their current residence. About one-quarter of renters did not have any gripes, the remaining three-quarters listed the building being old and needing improvements, rent being too high and increasing, poor maintenance and lack of space among reasons for disliking their current residence. Thirty-five percent of people who rent a single family home said nothing was wrong compared to 2 of apartment renters. This is also true for the number one complaint, poor maintenance/slow response. 9% of apartment renters make this complaint compared to 8% of house renters. This factor also depends on who manages the property. Those that dealt with an owner were more satisfied with their management; made this complaint compared to 3% of renters who deal with a management company. However, those that rent a house were more likely to complain about the house being old and needing improvements. Asian renters are much less likely to have complaints about maintenance, only 2.5%, however an 4% has security/safety concerns. Couples with children take more issue with lack of space (7%) and lack of outdoor space (5%). Also, respondents with children in the home were the only ones to complain about pests, 5% of couples with kids and 4% of single parents. About half of rental properties are managed by management companies and 44 percent are managed by the owner; six percent of respondents did not know who managed the property. There is a significant difference between who manages houses and apartments most commonly 65 percent of apartments are managed by a management company and 12 percent are managed by an owner. On the other hand, 50% of single family homes are managed by an owner and only 4 are managed by a separate management company. Those who rented from an owner were more satisfied with the management of their home than those who deal with a management company. This could also be related to the fact that those who dealt with management companies were more likely to have their rent raised. The average satisfaction for those who dealt with an owner was 7.6 while the average for those who dealt with a management company was 7, on a scale of one to 10, where 10 is very satisfied. Overall, renters are very satisfied with the management of their homes with 7.3 being the overall satisfaction level. People who rented houses over apartments were also slightly more satisfied; this is because the house owner usually manages the property.
14 Bibliography California Association of Realtors. (2013). 2013 Home Buyers Survey. CALIFORNIA ASSOCIATION OF REALTORS. (2013). 2013 Home Buyers Survey. CALIFORNIA ASSOCIATION OF REALTORS(R). (n.d.). 2012 Annual Housing Market Survey. CALIFORNIA ASSOCIATION OF REALTORS(R). (2013, Third Quarter). Housing Affordability Index. Harvard University Joint Center for Housing Studies. (2012). The State of the Nation's Housing. Olick, D. (2013, Feburary 12). Why Women are Driving the Demand for Rental Apartments. Retrieved January 2014, from CNBC: http://www.cnbc.com/id/100416547 Ross, B. (2013). What's next for 'gen rent' and California's shadow inventory? inman News, 1-1. The Conference Board(R). (n.d.). US Consumer Confidence Index. The White House National Economic Council. (2010, October). Jobs and Economic Security for America's Women. Retrieved October 15, 2012, from The White House: http://www.whitehouse.gov/sites/default/files/jobs-and-ecomomic-security-for-americas- Women.pdf U.S. Census Bureau. (2011). 2011 American Community Survey. Yonder, S. (2012). 10 Real Estate Trends to Watch in 2013. The Fiscal Times, 1-1.
15 List of Figures Female Single Head of Household with Children Male Single Head of Household with Children 36% 64% Figure 12: Percentage of Female vs. Male Single Head of Household with Children 24% 2 17% 14% 14% 7% 3% <25 25-34 35-44 45-54 55-64 65+ Refused Figure 29: Age of Renters
16 Women 58% Men 4 Figure 30: Gender of Renters 100% 80% 60% 40% 20% 0% 4 47% 58% 53% Renter Buyer Female Male Figure 30: Gender by Renter or Buyer
17 Couple, No Kids 17% Couple With Kids 23% Single Parent 14% Single, No Kids 45% Figure 31: Household Composition of Renters 29.3% 27.4% 18.1% 12.4% 7.5% 3.0% 1.1% 0.5% 0.5% 0.3% 1 2 3 4 5 6 7 8 9 10 Figure 32: Household Size
18 45.1% 35.3% Adults Children 17.5% 13.8% 11.8% 4.9% 3.8% 1.6% 1.4% 1.0% 0.5% 0.3% 0.1% 0.0% 0.0% 0.0% 0.1% 0.0% 1 2 3 4 5 6 7 8 9 Figure 33: Number of Adults and Number of Children in Renters' Households Single 59% Married 41% Figure 34: Marital Status of Renters
19 100% 80% 60% 40% 20% 0% 59% 41% Renters Married 29% 71% Home Owners* Single Figure 13: Renter vs. Home Owner Marital Status 3 26% 20% 10% 5% 4% Some High School High School Some College Voc/Tech School 4-Year College Grad School Refused Figure 35: Education Level of Renters
20 35% 24% 14% 15% 6% 5% 1% 1% Figure 36: Household Income of Renters 17% 10% 11% 5 8% African American / Black Asian Caucasian / White Hispanic / Latino Other Declined Figure 37: Ethnic Background of Renters
21 60% 5 50% 40% 38% 40% 30% 17% 20% 10% 0% 13% 8% 11% 6% 10% 3% 0% Renters CA* Figure 14: Ethnicity of Renters Compared to CA Ethnic Composition 45% 40% 35% 30% 25% Black Asian White Hispanic 20% 15% 10% 5% 0% < $35,000 $35-$49K $50-$74K $75-$99K $100-$149K$150-$200K > $200,000 Figure 38: Income by Ethnicity
22 Needed to move for family reasons Needed to move for work Foreclosure Divorce Short Sale Needed to move Lost home Bankruptcy Other Refused 1% 7% 8% 11% 10% 16% 21% 21% Figure 39: Reasons for Selling Primary Residence Figure 40: What Renters Dislike About Renting
23 Apartment 7 Single Family Home 15% Townhouse 4% Condominium 3% Duples/Triplex/Fourplex 3% Mobile Home 1% Other Figure 41: Type of Rental Figure 42: Most Reason for Selecting a Rental
24 53% 1% 6% 4% 5% 14% 1 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 43: Ranking of Importance of Reasonable Rent in Choosing a Rental 37% 19% 8% 7% 8% 1 3% 1 Not at All 1% 2 3 4 5 6 7 8 9 10 Most Figure 44: Importance of Neighborhood in Choosing a Rental
25 28% 15% 15% 7% 8% 10% 8% 3% 3% 3% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 45: Importance of Being Near Shopping in Choosing a Rental 27% 14% 14% 15% 4% 6% 8% 8% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 46: Importance of Being Near Work in Choosing a Rental
26 3 17% 11% 7% 10% 8% 4% 3% 4% 4% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 47: Importance of Being Near Public Transportation in Choosing a Rental 25% 13% 14% 13% 1 8% 7% 3% 3% 3% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 48: Importance of Being Near a Park or Other Outdoor Activities in Choosing a Rental
27 23% 13% 13% 13% 10% 4% 5% 4% 7% 7% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 49: Importance of Amenities in Choosing a Rental 31% 20% 13% 1 4% 3% 4% 6% 6% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 50: Importance of Being Near Family in Choosing a Rental
28 21% 18% 13% 9% 11% 11% 4% 5% 5% 6% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 51: Importance of Being Near Restaurants when Choosing a Rental 30% 29% 5% 1% 7% 4% 5% 8% 9% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 52: Importance of the School District when Choosing a Rental
29 34% 28% 11% 5% 4% 1% 3% 4% 7% 4% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 53: Importance of Allowing Pets when Choosing a Rental 31% 28% 5% 4% 8% 4% 9% 7% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 54: Importance of Being Near Child's School or Day Care when Choosing a Rental
30 38% 19% 11% 4% 5% 3% 5% 6% 7% 1 Not at All 2 3 4 5 6 7 8 9 10 Most Figure 55: Importance of Being Near Your School when Choosing a Rental Don t Know 59% < 1 Year 10% 1 Year 7% 2-5 Years 11% Indefinite 10% 6-20 Years 3% Other 1% Figure 56: How Long Renters Intend to Stay in Their Current Rental
31 Figure 57: Advantage of Home Ownership According to Renters Don t Know 11% No 41% Yes 48% Figure 58: Percentage of Renters that Plan to Buy a Home in the Future
32 Refused 3% No 83% Yes 14% Figure 59: Percentage of Renters that Have Student Loan Debt None 66% Credit Cards 20% Auto Loan Medical Bills Personal Debt Private Debt All Other Refused 6% 3% 1% 4% 5% Figure 60: Other Types of Debt that Renters Have
33 13% 1 14% Same neighborhood as current residence Same County where currently reside 14% 46% In another County in California In another State In another Country Don't Know Figure 61: Where Potential Buyers Plan to Buy 5% 7% 1% 4% 3% Detached SF Home Townhouse Condominium 81% Mobile Home Other Not Sure Figure 62: Type of Home Renters Plan to Buy
34 Can't Afford to Buy Prefer to Rent Too Old Economic Uncertainty Lack Down Payment Renting Has Less Responsibility Renting is Less Expensive Job Uncertainty Housing Market Uncertain Disabled Will Inherit Property Too Old to Get a Loan Other Don't Know Refused 14% 11% 9% 9% 7% 4% 3% 1% 1% 5% 3% 1% 51% Figure 63: Reasons for Not Planning to Buy a Home Figure 64: Motivation to Buy a Home
35 Online Search Real Estate Agent Friends/Family Drive Around / Check Neighborhoods See about a loan/prequalified Open houses Newspaper Ads All of the above / Multiple Answers Co-Workers Other Don't Know 5% 1% 1% 0.3% 0% 5% 17% 26% 4 Figure 65: Where Renters Will Start their Home Search No 9% Don t Know 17% Yes 74% Figure 66: Intent to Use a REALTOR
36 Figure 67: Meaning of the Term "REALTOR" (Pt. 1) Figure 68: Meaning of the Term "REALTOR" (Pt. 2)
37 Survey Methodology The Survey was conducted by telephone to 800 home renters statewide from April 26 th -May 25 th, 2013. The survey also used a computer assisted interviewing system (CATI) and was intended to measure the recipients experience with renting. In addition, the reported telephone results are subject to a maximum sampling error of +/- 3.46 percent (a 95 percent confidence level at two standard deviations). However, sampling errors were higher for specific regions. For the North Region it was +7.19, +4.61 for the South Region and +8.14 for other regions. The participants were incentivized to take the survey by the opportunity to be in a drawing for one of four $50 Amazon gift cards. The Survey was also conducted by email to 875 home renters statewide in August 2013. The reported results are subject to a maximum sampling error of +/- 3.3 percent at a 95 percent confidence level. The results presented herein are combined telephone and email respondents unless otherwise indicated.
38 Leading the way in California real estate for more than 100 years, the CALIFORNIA ASSOCIATION OF REALTORS (www.car.org) is one of the largest state trade organizations in the United States with 155,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles. The Association develops and promotes programs and services that will enhance the members' freedom and ability to conduct their individual businesses successfully with integrity and competency and, through collective action, promotes the preservation of real property rights. CALIFORNIA ASSOCIATION OF REALTORS Research and Economics 525 South Virgil Avenue Los Angeles, CA 90020-1403 213.739.8200 research@car.org http://www.car.org/marketdata/