In a recent trend that has shocked housing experts, a growing number of millionaires are choosing to rent a home rather than buy one.
“Between 2019 and 2023, the number of renter households with an income of $1 million or more grew from 4,500 to 13,700 — a staggering increase as an additional 9,200 millionaire renters joined the market,” a new report from RentCafe declared. It translates into a 204% surge in the number of millionaire renters in the period.
The number of millionaires who preferred traditional home ownership also soared by 169% in these years, climbing from 52,966 to 142,320 households. They continued to benefit from rising property values and previous historically low mortgage rates.
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However, the report described the rapid growth spurt of millionaire renter households as an inflection point. “Affluent individuals are increasingly drawn to the flexibility and amenity-rich offerings of high-end rental properties,” it commented, adding that the group has “a preference for turnkey living solutions over the responsibilities of homeownership.”
Many affluent renters continue to make their homes in established locations like New York and San Francisco, where the availability of apartments and high costs of ownership make renting a more cost-effective option. However, others are venturing beyond, especially to Southern cities.
The Southern metros with the highest increases in millionaire renter households between 2019 and 2023 were led by Houston, which saw 25 times the growth from seven to 179 renter households in the period. Other cities that saw sharp spikes in these households included Dallas (up 12 times), Miami (up 11 times), Atlanta (up 10 times), and Virginia Beach (up 6 times).
New hotspots for millionaire renters are also emerging across the nation, including Charleston, Oxnard, Jacksonville, Santa Rosa and Massachusetts, as well as cities in Massachusetts, Ohio, California, North Carolina, Tennessee, among other states.
Many millionaire homeowners are also diversifying the areas where they choose to live, often favoring places outside the traditional coastal regions and new Southern boomtowns. Cities that have benefited from this group include Salt Lake City and Orlando, each of which has seen the number of millionaire owners rise 19 times Some other cities with notable increases in the category include Pensacola (up 18 times), San Luis Obispo (up 17 times), and Chattanooga (up 16 times).
At the same time, traditional meccas retain their appeal for many, with the number of millionaire homeowners still rising sharply in cities like New York, Los Angeles, San Francisco, Boston, and Washington, DC, among others.
Data show that generational differences affect preferences between renters and homeowners. “While today’s typical millionaire renter is more likely to be a Millennial, the typical high-earning homeowner is more likely to be Gen X,” the report stated. Between 2019 and 2023, the share of wealthy millennials who rent rose by 60%, while Gen Xers preferred homeownership, even replacing Baby Boomers as the dominant group of well-to-do property owners.
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