Rental Demand is Surging 3x Faster Than Homeownership—Here's How to Catch the Wave

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In This Article

More Americans than ever are pressing pause on the dream of homeownership and turning to long-term rentals instead.

And honestly, can you blame them? With high mortgage rates and home prices climbing, buying a home isn’t in the cards for millions of would-be buyers.

As homeownership becomes increasingly out of reach for many buyers, rental demand is rising—and it’s not slowing down anytime soon. For real estate investors who are paying attention, this shift creates a powerful opportunity.

One of the best ways to capitalize on that demand? DSCR (Debt Service Coverage Ratio) loans. Companies like Dominion Financial Services offer these investor-focused loans that prioritize the income potential of the property itself—not your personal income or employment history. That means faster approvals, easier qualification, and more freedom to scale your portfolio.

The Trends of Homeownership vs. Renting

Homeownership is getting harder to achieve for many Americans, and that’s reshaping the housing market in a major way. While real estate investors may still be able to identify smart buy-and-hold opportunities, affordability remains the biggest barrier for the average buyer.

A 2023 CNN poll found that 86% of American renters still want to own a home someday, but they just can’t afford it. Once seen as a temporary pit stop on the way to homeownership, renting is becoming a long-term lifestyle choice.

This isn’t just a blip on the radar. It’s a full-blown macro trend.

Millennials and Gen Z, burdened with student loans and sky-high costs of living and craving flexibility, are renting longer than previous generations. They’re not chasing the white-picket-fence dream anymore. They want convenience, mobility, and freedom. And they’re willing to pay a premium for rentals that offer all three.

Meanwhile, baby boomers are joining the rental wave, too, downsizing from their big suburban homes into low-maintenance, comfort-first rental properties as they shift into retirement mode.

Recent data reveals a significant shift in the U.S. housing market, with many individuals opting to rent rather than buy homes. As of the second quarter of 2024, the national homeownership rate stood at 65.6%, indicating that approximately 34.4% of households are renters. Notably, the number of renter households increased by 2.7% in the third quarter of 2024, totaling a record 45.6 million. This growth rate is three times higher than homeowner households, which saw a 0.9% increase during the same period.

What does all this mean for you, the savvy investor? In short, opportunity knocks. Rental demand is exploding across urban and suburban markets, driving strong rent growth and offering landlords long-term income stability. If there were ever a perfect moment to capitalize on the rental market surge, it’s now.

How Can You Fund These Income-Producing Deals?

Enter DSCR loans, the real estate investor’s ultimate sidekick. DSCR loans offer a unique, investor-friendly way to secure financing, as qualification hinges entirely on the property’s cash flow rather than your personal income or employment verification. That means no digging through old tax returns, chasing down elusive pay stubs, or performing financial acrobatics to prove your creditworthiness.

But the benefits don’t stop there. DSCR loans provide greater flexibility with fewer restrictions than traditional mortgages. They typically have quicker approvals and closings, meaning investors can seize opportunities promptly in competitive markets.

Another significant advantage is that these loans aren’t reflected on your personal credit report, helping you maintain borrowing power for other individual or business needs. DSCR loans are designed to help investors tap into these opportunities swiftly, securely, and strategically, making them an essential tool for building a resilient, diversified real estate portfolio.

Dominion Financial Services, a privately owned nationwide lender, has your back with a comprehensive suite of financing options designed specifically for residential real estate investors. Whether you’re flipping properties, investing in reliable 30-year rentals, tackling ground-up construction projects, or bridging your way through multifamily investments, Dominion Financial has you covered as your convenient, all-in-one financial partner.

And here’s a bonus: Dominion Financial’s DSCR Price-Beat Guarantee ensures you get the most competitive loan terms for DSCR loans. Because let’s be honest: Why settle for anything less when you’re out here trying to build your real estate empire?

Ready to leverage the booming rental market and secure your financial future? Discover how Dominion Financial Services can help you achieve lasting success in today’s thriving rental landscape.