More of America’s highest-income households are selecting not to flip their buying energy into homeownership in a rental market that affords them more flexibility, mobility, and selection.
The quantity of U.S. households incomes at least $1 million a 12 months while renting the home they stay in rose 229% between 2020 and 2024, climbing to about 18,400 households, according to a new RentCafe evaluation of U.S. Census Bureau knowledge.
“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, younger high-income households are the ones leveraging that selection. 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 quickest of any technology.
Millionaire house owner households also grew quickly 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.
More of America’s highest-income households are selecting not to flip their buying energy into homeownership in a rental market that affords them more flexibility, mobility, and selection. UCG/Universal Images Group via Getty Images
It suggests that the development isn’t a rejection of homeownership but a generational complication of it. These youthful millionaires came of age in a housing market dominated by the ultralow mortgage charge homebuying growth and the steep run-up in home costs and borrowing prices that adopted.
And for many, it would appear, that made shopping for less of an apparent next step—even once they could afford it.
Why rich households are selecting to rent
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 quantity of U.S. households incomes at least $1 million a 12 months while renting the home they stay in rose 229% between 2020 and 2024, climbing to about 18,400 households, according to a new RentCafe evaluation of U.S. Census Bureau knowledge. New Africa – stock.adobe.com
The complete quantity of households incomes at least $1 million almost tripled, from about 70,000 to 208,000, and homeowners accounted for the overwhelming majority of that increase. In absolute phrases, renter households grew by roughly 12,800, in contrast with about 125,000 further millionaire householders.
Jones also notes that the $1 million threshold is nominal rather than adjusted for inflation, which means some of the growth displays more households crossing a fixed income benchmark over time.
Even so, the math still doesn’t clarify why high earners might discover renting enticing in the first place.
On that entrance, the occupational make-up of millionaire renters affords some clues. RentCafe’s knowledge says many work as chief executives, technology professionals, and financial managers—high-paying careers that can come with larger geographic mobility.
And renting gives these professionals something possession doesn’t: the skill to simply transfer.
About 21.6% of people residing in renter-occupied households modified residences in 2024, in contrast with 6.2% of those residing in owner-occupied households, according to U.S. Census Bureau knowledge. Renters were also roughly 3 times as possible to have moved from another state.
Nearly half (49%) of millionaire renters are Millennials, whose numbers surged 392% between 2020 and 2024, according to reports. fizkes – stock.adobe.com
That mobility can carry financial worth of its own, significantly early in a profession, when altering jobs—and sometimes cities—can open the door to higher alternatives. Workers in their first seven years of employment got roughly 36% to 42% of their cumulative earnings growth from strikes between employers, according to a 2021 examine utilizing U.S. Census Bureau employer-employee knowledge.
RentCafe says this dynamic is significantly seen in Houston, where prosperous newcomers—including executives, skilled athletes, and entertainers—typically rent after relocating before deciding whether to buy.
Homeowners, meanwhile, are getting hit with more incentives to keep put. Federal Reserve researchers estimate that mortgage charge lock-in defined 44% of the decline in mortgage-borrower mobility from 2021 to 2022.
About 21.6% of people residing in renter-occupied households modified residences in 2024, in contrast with 6.2% of those residing in owner-occupied households, according to U.S. Census Bureau knowledge. Houston Chronicle via Getty Images
The charge cycle also helps clarify why millionaire renting survived a period that initially appeared tailor-made for shopping for.
“The rate environment worked both for and against these households,” Jones says. Ultralow charges made borrowing low-cost early in the period, but stock was scarce.
“By the time inventory started to recover, both prices and rates were higher, making buying less attractive,” she provides.
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