High up-front costs are preventing renters from moving into the homes they want nationwide, and many of these renters believe that lower fees are the solution for a better leasing experience, according to survey of renters.
The nationwide survey of 667 renters found that affording the up-front costs of signing a new lease is the biggest worry in the context of renting, according to a release from financial services and rent guarantee company Jetty.
“Today’s renters are stressed. They worry about making monthly rent payments, they struggle to afford up-front move-in costs—and they’re ready for change,” the company said in the release.
Key findings of rental housing deposit alternatives survey
- Paying rent causes more stress than jobs, student loans, credit card bills, and political issues.
- Most renters worry that they won’t be able to pay rent.
- High up-front costs are preventing renters from moving into the homes and apartments they want.
- Almost half of renters wouldn’t be able to afford a cash security deposit right now—but security-deposit alternatives could be a game-changer for them.
Most renters worry they won’t be able to pay the rent at some point
There are many costs involved with renting, but monthly payments weigh the heaviest on renters.
When asked about their most burdensome renting expenses, almost half of renters (44 percent) cited monthly rent payments, followed by security deposits (26 percent), utility bills (16 percent), movers (8 percent), and broker fees (5 percent).
In fact, almost two-thirds of renters surveyed worry that they won’t be able to make their rent payments at some point during their lease cycle. Of those, 18 percent said that they worry about making rent every month or most months, and 46 percent said they worry about it at least two months out of the year.
Rental housing deposit alternatives
According to a report in MarketWatch, as many metros are seeing a flood of new rental apartments ease the supply crunch, rents remain high — up 3.6% compared to a year ago, according to fresh CPI data – and the barriers to entry, for many people, formidable. Now a new wave of start-ups is trying to apply fintech principles to helping ease some of the angst of getting into a rental agreement, even if it can’t do much about the rent itself.
Some consumer advocates are wary about innovations like the ones TheGuarantors – and competitors like Jetty and Insurent – offer, according to reports. Also there are others such as Suredeposit and Leaselock.
Typically renters pay a non-refundable fee and percentage to the companies.
Renters feel up-front move-in expenses are too high
High up-front costs are preventing renters from moving into the homes and apartments they want, according to the release.
Despite the stress renters feel about monthly payments, being able to make rent isn’t what they’re most fearful of in the renting process.
According to the survey, when asked what they’re most afraid of in the context of renting, 30 percent of renters ranked affording up-front costs, while 26 percent said keeping up with rent payments.
Almost 60 percent of renters have been prevented from moving into the rental homes or apartments they wanted because the up-front expenses were too high, the survey says.
Almost half of renters wouldn’t be able to afford a cash security deposit of one month’s rent right now. Survey respondents said security-deposit alternatives could be a game-changer for them.
While less than half of renters would be able to afford a cash security deposit of one month’s rent right now, 70 percent of those renters could afford a security deposit alternative.
This data was collected through a survey by Jetty designed to discover how renters feel about renting and what challenges they face in the process. The company used a third-party survey tool to reach a sample of U.S. renters, balanced for age, gender, and geographic region, and gathered a total of 667 responses.