Americans think renting is cheaper than owning
Collective beliefs have a habit of coming self-fulfilling prophecies. If everyone thinks Bitcoin is the future of money, the price will go up an order of magnitude. When many lose that faith, it will crash.
In many ways, housing is no different. The belief that US national house prices had never, and will never, drop in price led to a massive bubble that nearly took down the financial system.
Prices took a decade to recover but now the pendulum is swinging again and it's toward pessimism. A survey released today by Freddie Mac says some 78% of Americans view renting as more affordable than owning a home. That's up a whopping 11 percentage points from the last survey six months ago.
That's a poor sign for housing and home buying going forward.
In addition 58% of renters say the don't currently have plans to buy a home, up from 54% six months ago.
Part of the story is that rental supply has hit a 30-year high, making the math more favorable especially with home prices rising.
