A Changing American Housing Landscape
Recent industry analysis, including reporting highlighted in Scotsman Guide, shows more families deciding they will remain renters for the long term. For some, that choice is due to financial strain. For others, it’s because of a belief that homeownership has moved beyond reach.
For our Veteran community, this trend has a deeper meaning. After years of service, deployments, and sacrifice, stable housing is more than an economic milestone. It is the foundation for family security and long-term wealth. The Department of Veterans Affairs designed the VA Home Loan after World War II to give returning service members a fair start in civilian life, regardless of how much they had in savings. It remains one of the most powerful housing benefits in the country.
Yet we now see more Veterans renting for long stretches of their post-service lives. In many markets, prices and competition have been enough to discourage even well-qualified buyers. The challenge is real, but so are the consequences.
The Federal Reserve’s 2022 Survey of Consumer Finances reported a median net worth of approximately $396,200 for homeowners versus just $10,400 for renters. Homeownership remains the primary engine of household wealth in the United States. When Veterans choose renting for the long run, the full weight of those numbers needs to be understood.
A Personal Perspective from Service
During my years in uniform, one lesson that remained constant was that the decisions we make today shape the stability of tomorrow. Housing is one of the clearest examples of that truth.
Service members understand discipline, preparation, and responsibility. Applied to homeownership, those same qualities can provide security long after the uniform is retired.
The VA Home Loan benefit is not simply a mortgage program. It’s a promise the nation made to those who served. It exists so that Veterans and their families can step into civilian life on solid ground.
As more Americans accept long-term renting as inevitable, Veterans should know they are not bound by that trend. Their service has earned them access to a different path and to better tools.
Why More Americans Are Renting
The shift toward long-term renting has many causes. Several forces have come together to reshape the housing landscape:
Rising home prices
In high-demand regions, especially along the coasts, home prices have grown faster than incomes for more than a decade. As of late 2025, there was a reported median listing home price of about $975,000 in Los Angeles County and around $1.2 million in the city of San Francisco, with several Bay Area counties (like San Francisco, San Mateo, and Santa Clara) posting median sale prices in the $1.4 – $2.0 million range according to California Association of Realtors data.
Low housing supply
A persistent shortage of available homes has kept competition high. Many would-be buyers submit multiple offers, only to lose to cash buyers or to conventional loans that are perceived to have fewer conditions.
Interest rate volatility
The rise in mortgage rates between 2022 and 2024 changed the monthly payment equation for millions of families. Even at levels that are historically normal, the speed of the increase pushed many households to the sidelines.
Economic uncertainty
Inflation, job instability, and rising costs for food, healthcare, and transportation have led many families to value liquidity and flexibility over long-term investment.
Taken together, these factors have led more Americans to conclude that renting is the safer choice, but the long-term data shows otherwise.
The Wealth Divide Between Owners and Renters
Federal Reserve survey data show that homeownership and home equity are among the largest contributors to family net worth, with typical homeowners holding much larger wealth than renters.
The Federal Reserve’s 2022 Survey of Consumer Finances reported:
- Median homeowner net worth: approximately $396,200
- Median renter net worth: approximately $10,400
That is nearly a 38-to-1 difference.
The same survey found that home equity typically accounts for roughly 25 - 30% of a homeowner’s total net worth. For many families, the home is the anchor asset.
Research from the Urban Institute shows that Americans who buy their first home before age 35 build substantially more housing wealth by their early 60s; those who purchase between ages 25 and 34 have median home equity of about 150,000 dollars at age 60–61, with more than 100,000 dollars higher median housing wealth than people who wait until 45 or later to buy.
For Veterans, these numbers carry added weight. Military service often delays traditional earning and saving cycles. Many service members enter civilian life later than their peers, with years spent in uniform instead of in the civilian labor market. The VA Home Loan was created to help close that gap.
When Veterans rent for ten or fifteen years before buying, the opportunity cost compounds quietly in the background. It rarely becomes visible until much later in life.
Veterans and the National Decline in Homeownership
Veterans have historically owned homes at higher rates than the general U.S. population (78.4% vs. 65.7% national average in recent Census-linked data), but that edge has narrowed in recent years as younger generations struggle with affordability.
VA loans made up about 10.2% of new purchase mortgages for one‑ to four‑family owner‑occupied homes in 2022, roughly in line with their share over the past several years rather than dramatically higher, suggesting that the VA purchase market has held a steady but modest slice of overall originations.
The Veteran population did not collapse. Eligibility rules did not bar large new groups of borrowers. The VA benefit did not suddenly become uncompetitive.
The drop reflects something simpler and more concerning:
Veterans are not using the benefit at the rate that their eligibility and need would suggest.
Several factors play a role:
Misconceptions about the VA loan
Urban Institute research shows that many Veterans still believe they must put money down or that VA loans carry higher rates. In reality, the program is built around no down payment for eligible borrowers and competitive fixed rates.Fear of competition in tough markets
In highly competitive markets, some Veterans feel pressure to choose conventional loans because they believe sellers prefer them. This perception persists despite the VA program’s strong performance and long record of low default rates.Limited upfront savings
Even when a Veteran can comfortably afford the monthly payment, the cost of inspections, appraisals, and closing fees can be enough to delay or derail a purchase.- Lack of access to VA-savvy real estate agents
Agents who are unfamiliar with the VA program may steer Veterans toward conventional financing or suggest that VA offers will not be competitive in bidding situations.
For a benefit designed to allow service members to step into civilian life on solid footing, these barriers are often psychological or procedural rather than structural.
Why Renting Long-Term Carries Unique Risks for Veterans
For many Americans, renting long-term feels like the path of least resistance. For Veterans, that assumption can be especially costly over time.
Rising rents versus fixed incomes
Veterans relying on VA disability payments, military retirement, or other fixed income streams may struggle to keep pace with rent increases in fast-growing markets.Limited wealth formation
Renting provides shelter but does not build equity. Without a mechanism that steadily converts monthly payments into ownership, long-term wealth accumulation becomes harder to achieve.Fewer options in times of stress
Homeowners can sometimes refinance, sell, borrow against equity, or downsize. Renters do not have those levers available in the same way, especially when markets tighten.- Higher instability for families
Lease expirations, landlord decisions, and rising rents can force frequent moves. For families, especially those with school-age children, that instability can have real educational and emotional costs.
Homeownership is not only an investment. It is a stabilizing force in the life of a Veteran household.
The VA Home Loan: A Benefit Built for This Moment
The architects of the 1944 GI Bill understood that homeownership would be essential for returning service members. The VA Home Loan program has carried that mission forward for more than eighty years.
Its core features remain:
- No down payment for eligible Veterans in many circumstances
- No private mortgage insurance
- Competitive fixed interest rates
- More flexible credit standards than many conventional loans
- Lifetime benefit, with the ability to reuse entitlement under specific conditions
VA loans also perform well under stress. Historically, they have posted lower default rates than many other loan types. One reason is the VA’s residual income requirement, which ensures that borrowers retain enough income for basic living expenses after their housing costs are paid.
For Veterans accustomed to planning, discipline, and accountability, that safeguard reflects values they already understand.
The Psychological Barriers to Purchase
Price and supply challenges are substantial. Yet many Veterans who could qualify to buy still hesitate because of uncertainty. Common concerns include:
- I do not want to overpay in this market.
- I do not have enough savings for closing costs.
- The VA loan process seems complicated.
- I heard sellers will not accept VA offers.
These concerns are understandable, but they are not always accurate.
Sellers do accept VA offers when those offers are backed by strong pre-approvals and presented by VA-trained agents. Closing costs can often be financed or offset by lender credits and seller contributions. VA loans do not have to be slower when handled by experienced purchase teams.
The gap between perception and reality can cost Veterans years of opportunity.
How Renting Long-Term Shapes Post-Service Trajectories
A Veteran who rents for ten years after leaving service faces a different financial trajectory than one who buys in the first three.
Consider two service members with similar income and credit profiles:
Veteran A buys a home soon after transition.
Over the next decade, principal is paid down and equity grows as markets rise and fall.- Veteran B rents for that same decade.
Rent payments increase over time, savings are harder to grow, and rising home prices push the entry point farther away.
By age 50 or 55, the differences in wealth can be dramatic. For Veteran A, home equity may now be the largest asset on the balance sheet. For Veteran B, the lack of equity makes catching up far more difficult.
How Policy and Market Trends Influence Veteran Choices
Several broad trends shape the choices facing Veterans today:
Housing affordability pressures
Home prices are rising across the nation. For Veterans in high-cost states such as California, Washington, Colorado, and Virginia, that pressure is acute.
Geographic mismatch
Many Veterans settle near major bases or metropolitan areas where housing is already scarce. Cities such as San Diego, Norfolk, and Colorado Springs are among the most competitive markets in the country.
Underutilization of education and counseling
The VA’s Transition Assistance Program includes materials on financial literacy and homeownership, yet usage is uneven.
What Veterans Can Do Now
Homeownership is not out of reach for most Veterans. It does, however, require deliberate planning. Practical steps include:
Review the Certificate of Eligibility (COE)
Many Veterans are eligible for the VA Home Loan without realizing it. Confirming the COE is a straightforward first step.Strengthen credit reliability
On-time payments, reasonable credit utilization, and accurate credit reports remain core factors in any underwriting decision.Understand entitlement
Full entitlement allows zero-down borrowing beyond local conforming limits, subject to lender approval. Partial entitlement may require a down payment, based on how much entitlement remains in use.Work with VA-specialized lenders and agents
Not every lender or real estate agent is experienced with VA loans. Veterans should seek professionals who work with the program regularly and understand its rules in practice.Begin the process early
Pre-approvals and documentation reviews can uncover issues months before a Veteran is ready to make an offer. Early visibility allows time to correct them.- Compare renting versus buying over a ten-year horizon
The monthly difference between rent and a mortgage may be smaller than expected when property tax exemptions, disability income, Basic Allowance for Housing, and long-term equity are taken into account.
These steps don't guarantee a smooth path, but they put control back in the hands of the Veteran.
The Road Ahead
The shift toward long-term renting will continue to influence the American housing market. Veterans should understand its full implications. Renting may relieve certain immediate pressures, but it cannot match the long-term security and wealth-building potential of owning a home.
The Federal Reserve’s data are consistent across decades. Homeownership remains the cornerstone of American financial health.
For Veterans, the choice carries even greater weight. The VA Home Loan benefit is one of the strongest tools available to any homebuyer in this country. Using it early and wisely can change a family’s financial trajectory for generations.
The decision between renting and owning is not only a question of monthly payments. It is a question of financial readiness, of legacy, and of the long-term stability that every Veteran has earned.
