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Related: Editorials & Other Articles, Issue Forums, Alliance Forums, Region ForumsThe Big Winner in the Rental Home Shortage: Wall Street
http://www.bloomberg.com/news/2014-12-19/rental-housing-shortage-gives-boon-to-corporate-landlords.htmlTheres an undersupply of single-family houses and apartments to rent for the first time since 2001, according to an analysis by Frank Nothaft, chief economist at mortgage buyer Freddie Mac, based on available inventory and historic vacancy rates.
Corporate landlords are benefiting from the worst U.S. rental-housing shortage in more than a decade as construction trails demand and more Americans opt to lease rather than buy.
Theres an undersupply of single-family houses and apartments to rent for the first time since 2001, according to an analysis by Frank Nothaft, chief economist at mortgage buyer Freddie Mac, based on available inventory and historic vacancy rates. The deficit in the third quarter was about 350,000, the most in records dating back 14 years.
The shortage is giving the upper hand to institutional investors who spent more than $25 billion since 2012 buying single-family homes to rent. While the market for apartments has been in favor of landlords for five years, owners of houses are now able to increase rents and reduce turnover to boost profits.
Its that supply-demand equation that allows us to get aggressive about raising rents, Stephen Schmitz, chief executive officer of American Residential Properties Inc. (ARPI), a landlord with more than 8,500 homes, said at an investor conference this month. Three years ago, you would go to raise somebodys rent and they could say, Ill go down the street and pay $100 less than Im paying you now. But today they cant because all those houses down the street are occupied.
hobbit709
(41,694 posts)That's what's going on here in Austin, you see 5 or 6 people sharing a 3 bedroom place and they're still barely managing to get by.
djean111
(14,255 posts)In the meantime, people will adapt and manage, or else live in places and situations they would never have considered before.
Then - what? - unable to sustain high rents (and, I am sure, unwilling to keep paying property taxes and upkeep), the big landlords might dump all those houses on the market again, lowering property values and perhaps making another mortgage crisis possible, this time in the hurry to get rid of homes that are costing them money because they are unoccupied, but still need upkeep and taxes paid.
Oh, or they may pay state legislators to keep decreasing property taxes, thereby weakening local government.
Round and round we go. It seems to me that any time the rich corner a market in anything, things end up all fucked up and everyone pays the price. Everyone but them, of course.