The share of renters in the U.S. who believe they will someday own a home has plummeted over the past year, as the home affordability crisis continues to make the American dream appear too far out of reach.
The New York Federal Reserve's 2024 SCE Housing Survey released Monday found renters' perceptions about the ease of obtaining a home mortgage have "deteriorated substantially" since 2023.
The percentage of renters who say that obtaining a mortgage is somewhat or very difficult jumped to 74.2%, a more than 8 percentage point increase from last year, and far above the low of 50.5% in 2021, the survey found.
At the same time, the percentage of renters who said they believe they will eventually become homeowners fell to 40.1%, a drop of 4.3 percentage points from last year and a new series low in the survey that has been conducted for a decade.
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The data also indicates Americans expect housing affordability to become even worse.
The housing survey, which is part of the New Fed's broader Survey of Consumer Expectations, saw rent price growth expectations for the next year increase by 1.5 percentage points to 9.7%, which is the second-highest reading in the series since 2022.
U.S. households also anticipate mortgage rates to continue their upward climb, with respondents saying on average they expect mortgage rates to rise to 8.7% a year from now, and to 9.7% in three years. Both of those averages, the Fed's analysts noted, are also series highs.
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The findings serve as further evidence that the housing affordability crisis in the U.S. is weighing on aspiring homeowners, and continues to escalate with no end in sight.
The average 30-year fixed-rate mortgage has sat above 7% for weeks, according to Freddie Mac, and a recent report from Redfin found that the combination of steep mortgage rates and elevated home prices has pushed the median monthly housing payment to a new record of $2,775, an 11% increase from the same time last year.
The high costs have pushed homeownership out of reach for many Americans and have left the housing market stalled for months as many would-be buyers and sellers remain on the sidelines waiting for affordability to improve.
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The Fed's survey also found that Americans increasingly plan on staying put rather than moving in the near future.
The authors wrote that "Average expectations of residential mobility, the percent chance of moving to a different primary residence, fell to new series lows at both the one-year (13.4%) and three-year (24.5%) horizons, continuing a declining mobility trend since 2014."
