Meanwhile, the cost of renting has been going steadily up along with the rise in demand for apartment units. So, even as economists talk of now being a great time to buy, low-cost rentals would be even more welcome to many Americans.
Some of you may recall that “by day” I am a commercial property manager — real estate is my job. And while I don’t dabble much in residential things (so this is more of a personal opinion than a professional one) I do think this is a bit of a bullshit statement.
Low-cost rentals would be great, but are hard to make happen because of a little thing called supply and demand. With foreclosures, divorces, unemployment, and a general shit economy (that’s my professional opinion on the economy) on the rise more and more people are simply not able to buy homes. That leaves two options (well two decent options):
- Go live with another family member.
- Go rent.
Most people over 25 choose option #2 — we’ve been seeing a ton of renters that haven’t rented in 20 years because they used to own a home. With the flood of these new renters, demand for rental units — specifically rental units that will take poor-to-no rental history — is on the rise. When demand is on the rise, apartment owners cash in by raising rents. Goodwill is great, but most apartment owners are struggling too, so there’s no talking them out of raising rates when they can — after all apartment supply is often constrained in times like these.
It’s easy for Trumbull to say “we need more low-cost rentals”, but what he doesn’t look at is the market forces that are driving rental rates. Get more people to buy homes, and rental rates will come down.
And if you are wondering what you should do personally, the New York Times has an interesting way of looking at it.