So here we are 5 years after the financial crisis and rents have skyrocketed, seems those who lost their house have now gone out to rent, that equals party time for landlords. Seems there is no limit to how high prices can go, seems like there is no stopping the rise of rents, would be nice but with people still in foreclosure and losing their houses the only other option is to rent and if people know the market is hot they will get what ever price they want, of course this will only last for so long, once rents peak, which will happen they will come down pretty hard, who knows how many years away that it but if its not rising housing prices, oil prices, food prices, commodity prices its now rent prices. It has to stop somewhere, if it wasnt for the trillions and trillions and trillions of dollars that BUBBLE ben bernanke and friends pumped into the system these past 3-4 years prices wouldn't be skyrocketing like they are. This all comes down to pumping the economy with worthless dollars creating a fake, imitation economy. Apartment rents rise at highest rate since 2007: Reis July 04, 2012|Lauren Tara LaCapra | Reuters (Reuters) - Renting an apartment in the U.S. became even more expensive during the second quarter, as vacancies set a new 10-year low and rents rose at a pace not seen since before the financial crisis, according to real estate research firm Reis Inc. The average U.S. vacancy rate of 4.7 percent was the lowest since the fourth quarter of 2001, down 0.2 percentage points from the prior quarter, according to preliminary data Reis released on Thursday. Asking rents jumped to $1,091 per month, 1 percent higher than the first quarter and the biggest increase since the third quarter of 2007. Excluding special perks designed to lure tenants, like months of free rent, the average effective rent rose 1.3 percent to $1,041. "The improvement in rents is pretty pervasive," said Ryan Severino, Senior Economist at Reis. "Even in places like Providence and Knoxville, which you don't think of as hotbeds for apartment activity, landlords felt the market was strong enough to raise rents on their tenants." Those two cities, in Rhode Island and Tennessee, respectively, posted quarterly effective rent increases of 0.7 percent, the smallest quarterly rise of the 82 areas tracked by Reis. No area posted a decline. On an annual basis, effective rents rose by at least 2.2 percent nationwide. Severino characterized the broad increase in rental prices last quarter as "pretty amazing." Apartment dwellers have been facing higher rents since late 2009 but the pace of increase has been picking up steam over the past three quarters. The surge in rental prices stems from a growing number of people who are looking for places to live, but are not willing or able to buy a home because of the ongoing slump in the housing market and tight lending conditions. A dearth of new construction has also led more and more people to squeeze into tight urban areas at higher prices. Generation Y has also been a driving force for higher rental prices in urban areas, particularly in cities like New York and San Francisco, where job markets are relatively strong. Even though home ownership costs less than renting, young professionals prefer to rent apartments in tightly packed cities than move out to the spacious suburbs, Severino said. "This generation doesn't hold home ownership on a pedestal the way prior generations did," he said. These dynamics have made the U.S. apartment market the best performing sector of commercial real estate since early 2011. That has helped landlords such asEquity Residential, Post Properties Inc, UDR Inc and AvalonBay Communities Inc, which have large concentrations of high-end apartment buildings in urban areas. The particularly dense and expensive rental market ofNew York City loosened up slightly in the second quarter, with vacancies inching up 0.2 percentage points. Yet with a vacancy rate of 2.2 percent, New York remains the tightest market in the country and is by far the most expensive. New York's effective rents rose at a rapid 1.7 percent clip from the previous quarter and 3.9 percent from a year earlier. The average renter's effective monthly tab of $2,935 beats the second-most expensive city, San Francisco, by over $1,000. That California innovation hub and other technology-oriented markets like Seattle, Boston and Denver also posted sizeable gains in effective rents on both a quarterly and annual basis. Memphis, Tennessee, had the lowest vacancy rate at 9.2 percent. The cheapest city to live in of the 82 urban areas that Reis tracks was Wichita, Kansas, whose monthly rent of $510 was less than half the U.S. average.
Why would anyone with lots of money want to own anyways? You buy a house, your owning it for the next 9 years like it or dislike it. cheers
In the book "millionaire next door", they found a pattern. They live in the same house for decades, married once and not divorced, own a business, and frugal. The Wall Street rich may not fit this pattern, however.
This is another plan to pacify the masses!!! lol If you own your house, you have freedom. If you rent, you are a slave forever. Worried that you are not sheep enough for your boss and you might get fired. The "American Dream" was made up to get you into massive debt, and it worked; however, they never thought people would just walk away from their house. The lesson: Buy a house you can easily afford. I don't care if it's only 200k but you really think you can get pre-qualified for 350k. Once you pay off the house, it's smooth sailing. sort of. lol
Agree...get a 15 year loan on a house when you are young. After 15 years, you never have to pay a mortage or rent again because you have 100% equity. Then you can sell your house and move and you have the cash to buy another house and not have payments. The renter will pay the landlord until the day he dies though. So if you live to 80 years old there are 2 roads. The homeowner road where you buy at 20 years old and its paid off by age 35 and no more payments. Or you rent and you pay it for 60 years (each year rent going higher and higher.) Seems likea no brainer to me.
just don't buy in the next couple of years because since housing prices are still dropping if you rent for the next 5 years and buy then vs buying today you'll be in better shape 20 years out if you wait 5 years from now.
most civilized countries have rent controls, one of the solution to bubbles and unaffordable rents is rent control. If you are against it, you must be a landlord, it causes no problems elsewhere why would it in the US ? tHis is just the only way to keep landlord's greed in check. After all they also in large part caused the bubble
I have to disagree, 4.5% mortage= a lot of house compared to renting, cheaper to buy even if housing market drops for 2 more years. Currently renters are appx. paying 2x what the mortage are currently, from what I've seen.
Rent control is solicalism. And even if a tentant is paying 2x- 2.5x the mortage in rent there is still many costs involved in the landlord game. Propetry taxes much higher then owner occupied dwellings, landlord license, higher insurance, turnover, matinace and vacancy rate, profits are not that great even 15years in.