Renting is Harder Than Buying
The real estate industry is an unrelenting hot market in the U.S. More people are renting rather than buying making the rental market an all time high. Renting is harder than buying, according to CoreLogic Rental prices for single family homes grew 7.8% in 2021. The market is still being affected by the pandemic and you are seeing more young families leaving coastal cities to escape for the Sunbelt. This has caused a double-digit increase in housing and a high demand for supplies. For more information, please read below.
Renting is harder than buying a home. Rental prices for single family homes have increased by 7.8% in 20201. This is an all time high. Just in December rent prices went up 21%. Homes values are also increasing and there is not much inventory out there to choose from. Mortgage rates are climbing as well making it easy for people to decided to rent rather than buy.
Shifting to Rentals
People are getting pushed out of the housing market making renting a home more appealing. It is especially hard for first time buyers and millennials to take on such a large financial burden at such a young age. Institutional investors are also making an impact on the housing market, effecting home prices as they are buying single-family homes and renting them out. “Landlords, builders and institutional backers have committed 85 billion to that effort, according to Alan Ratner, an analyst at hosing research firm Zelman & Associates” (Allison McNeely).
Biggest Rental Increases in Metropolitan Areas
Housing Economist are predicting that the rental market is not going to let up anytime soon. Renting right now seems more desirable to the younger generation because of the soaring home prices and mortgage rates. Rents in coastal cities such as New York, have recovered but Sun Belt Cities remain high and due to the work from home life style they are not predicted to lower anytime soon.
Companies like MartelTurnkey are buying, renovating, and selling single family homes to investors. Investors are outbidding the public and it is creating a dramatic shift in the market. These companies are helping investors get financing and tenants. This method is more profitable than flipping homes. With the rise in mortgage rates, it might effect this process. Until then people are biding over 5,000 a month on rental properties that were once 2,000.
Information from Bloomberg Wealth. Article “Renting a Home is Even Harder Than Buying One in Unrelentingly Hot U.S. Market” Written by Allison McNeely.
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