A recently conducted Harris Poll found that conventional perceptions about rising rent may be wrong. It seems that though many Americans are experiencing a rising cost to rent, they are content to remain where they are (on the majority, anyway). Rising rents are not necessarily pushing people into buying homes.
The article linked above does discuss that a large factor in that mindset is strictly financial: they can’t afford to buy a home. And I think that conversation stretches far beyond the rent vs. mortgage comparison. For instance, you may be able to find a mortgage that’s cheaper than what you’re currently paying in rent. But there are many unforeseen costs a homeowner is responsible for that landlords typically cover. Painting, maintenance, major appliances, general upkeep – these all take away from the bottom line of the homeowner. So the financial roadblock is a real one.
But it would be interesting to research and see if there is another major factor playing into this: transience. Americans move. For various reasons (job relocation, education, family, etc.), many people are frequently moving, on average once every five years. If you’re in that category and you know you don’t plan on staying anywhere for too terribly long, purchasing a home (and all the hassle that comes with it) might seem unattractive. That might especially be the case if you’re electing to move and you don’t work for a company that will assist you using a corporate relocation company.
If what we’re building is an increasingly transient culture, the “permanence” of buying a home (real or perceived) would be unattractive.