Why Gen Z and millennials are choosing rent over ownership at shockingly high rate
More of America’s highest-income households are choosing not to turn their purchasing power into homeownership in a rental market that offers them more flexibility, mobility, and choice.The number of U.S.households earning at least $1 million a year while renting the home they live in rose 229% between 2020 and 2024, climbing to about 18,400 households, according to a new RentCafe analysis of U.S.
Census Bureau data.“Standard measures treat renting as a fallback for people who can’t buy.Here, the top of the income distribution may increasingly be renting by choice,” explains Realtor.com senior economist Hannah Jones.And overwhelmingly, young high-income households are the ones leveraging that choice.
Nearly half (49%) of millionaire renters are Millennials, whose numbers surged 392% between 2020 and 2024.While Gen Z accounts for just 2% of the market, its millionaire renter population grew 46-fold over the same period—the fastest of any generation.Millionaire homeowner households also grew rapidly over the same period, rising 193%.
Renters still make up only a small share of $1 million-income households, but their share rose from 8% to just under 9%, according to Jones.It suggests that the trend isn’t a rejection of homeownership but a generational complication of it.These younger millionaires came of age in a housing market dominated by the ultralow mortgage rate homebuying boom and the steep run-up in home prices and borrowing costs that followed.And for many, it would seem, that made buying less of an obvious next step—even once they could afford it.Some of the dramatic growth comes down to math, according to Jones.“Part of the gap is a base effect, since renters started from far fewer households; it is possible to see more growth,” she explains.The total number of households earning at least $1 million nearly tripled, from about 70,000 to 208,000, and owners accounted for the overwhelming majority of that increase.
In absolute terms, renter...