Remember when trolls said this would never happen?
One more thing the trolls were wrong about. But damn, this one was just so obvious - it's called supply and demand.
Remember though that the government inflation data's #1 component is rent, so get ready for deflation (or the statistical deflating of inflation).
Home Sellers' Pain Is Renters' Gain - There's one bright side to the housing crisis: some lower rents.
But in the regions hit hardest by the subprime crisis, finding a rental apartment is easier and, in some cases, cheaper than it was before the crunch. Some homeowners forced out by foreclosure are finding rental deals that are at "discounts of 50% to 70% off what they were paying on their mortgages," says Brenda F. Gerdes, who owns Management Specialists Inc. in Port St. Lucie, Fla.
Behind the trend are tens of thousands of unsold condominium units that are being dumped on markets such as South Florida, Las Vegas and Phoenix.
January 21, 2008
As predicted, as housing crashes, rents fall too. Could it get any better for bubble sitters?
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Rents are still rising in Portland, no relief in sight.
Rents falling, panic in the markets, energy costs holding the high ground -- sounds like panic in the streets is just a few days away. And I just love the impact of falling rents on the official inflation figures! Nope, no inflation here.
Question -- is there any prohibition on the Fed taking rates negative?
Time to stock up on essentials!
Coke Out!
Why haven't all the WHORELORDS in Scottsdale gotten this memo????
My rent here is the highest I've paid anywhere in the USA in 23 years by far.
Los Angeles still seems pretty darn expensive for rent. They have two bedroom apartments going for $ 2200 a month. HOW IS THAT CHEAP?
I dont know if rents will Ever come down here. Could it be because of the puto illegals living 20 to a room which keeps rent high?
Here in SF, rents are up between 9% and 14%, year-over-year -- while housing prices in the core are down about 10%. People want to live here and there are plenty of jobs. If they can't get financing on a mortgage, then they'll rent.
This is encouraging news for the core Bay Area market. If it's all about P/E, we're restoring balance on both sides of the equation. I figure the core areas have another 10% to fall, with a 5% to 10% increase in rents, to achieve something close to balance.
Of course, this only applies to the core areas where there are plenty of high-paying jobs and not nearly enough housing. God help you if you're living anywhere east of Berkeley and Oakland ... there's still PLENTY of room for prices to fall out in the hinterlands.
Stockton is going to be one nasty-ass suburban ghetto wasteland, that's for sure ...
I'm skeptical of these numbers. Sure median rents have gone down. But I see that more at the low end simply with more condos available. If an apartment that cost $900 is now $850, that doesn't do much for me.
Homes that were going in the $2K range a year ago are still in the $2K range. Having a 0% rent increase is fine by me, but I don't buy this fires ale in rents just yet.
Only if Air force one crashes...
Rents are definitely falling here in SW Florida. This fall, friends of mine went from paying $1500 for a 3/2 to paying $850 for a 3/2. Granted, the first had a pool, but the house itself was in BFE, not that nice, and surrounded by half-finished construction. The house where they rent now is much nicer...and much less expensive.
Seems to me that the condo rents aren't going down as much (YET) because, aside from the astronomical mortgage bill, the owners are also dealing with those pesky HOA fees...no worries, rents will be drastically dropping there soon enough.
Here in Lee, our rental occupancy rate is only 80%. One other trend I'm noticing is that landlords are more apt to allow pets...anything to get a renter.
Keith, I'm with you guys, but in NYC for example, rents will stay firm as more people rent vs buy and since cap rate is already low, the correct ratio will come in the form of price reduction rather than rent rise. I dont like this as I'm a renter.
Yes, I've seen cheap asking rents in Florida, by some desperate speculators. Thing is, I live in NYC, where the higher paying jobs are. Last I checked, NYC landlords are asking historically high rents.
Don't forget San Diego - A new 250 unit condo opened LAST WEEK downtown - the Electra, and already 23 units are on the rental market, and 10 on the re-sale market!!! The rest haven't even closed escrow yet. . .added to the other 1000 or so downtown condos on the market. . .not good.
My rent is lower than it was 4 years ago even with all the inflation raging in the food and energy markets.
One more thing the trolls were wrong about. But damn, this one was just so obvious - it's called supply and demand.
duuuuh what is suplie and da man??
Rents are rising in Northeast Wisconsin. Or so I am told by the renters I know.
Rents have come down a bit in the Tampa Bay area, but not that much though...maybe 10%. However, the cost of rent vs own is where you see the difference.
I rent a 1/1 for $800 a month. Water, sewer, trash, pest control, and cable are included. There's a unit in my building going for $141,000. It's smaller than mine too.
So, rent at about $800 or buy the SMALLER unit at $141,000:
Mortgage: $868
Taxes: $212
HOA: 276
Insurance: $60
And own it for the low monthly cost of $1,416! Plus, you get to pay for repairs, expect rising taxes, and who knows about insurance!!
Why would you buy? Even if you talk them down to $90,000 (good luck) renting is still cheaper!
-Dragasoni-
I plan on low-balling the crap out of Floplords in DC/NoVa come next July or Aug, just about the time they realize that they just went through the 3rd flopped "Spring" market & they didn't sell the POS AGAIN!
Currently rent in NoVa (Northern Va for those that don't know).
I chewed our current floplord down 200 a Month in the rent & made him pay the 150.00 per Month HOA fee to boot! (Note: this house had been on the Market empty for a YEAR)
This is a 3000 square footer in a "fancy" gated community, but it's pretty "stripped" as far as goodies/options in the house.
We want a much bigger & nicer/newer house next summer & I'm sure they'll be ripe for the picking!!!
And probably cheaper too or we ain't gonna rent it! :)
During the housing boom rents fell as eveyone wanted to buy. It makes perfect sense that rents will rise now as everyone wants to rent.
It won't get better for anyone - regardless where you live ... rent, own, house debt.
Food and utility prices keep climbing and climbing.
As Peter Schiff stated ... it doesn't make any difference where you live if it takes $500.00 to fill up your refrigerator.
Why haven't all the WHORELORDS in Scottsdale gotten this memo????
My rent here is the highest I've paid anywhere in the USA in 23 years by far.
Dude you're being taken for a ride. I lived in Scottsdale for 7 years and know plenty of people who still live there and they're renting for pennies on the dollar. You need to do a better job shopping or negotiating next time.
Unless you live in a Scottsdale apartment which are all totally overpriced ripoffs. It's cheaper to rent a big house than an apartment in Scottsdale. Hell you can find those Optima Camelview "luxury" condos renting for $2,000 now.
Our lease is coming up here soon (Newport Beach CA) and we started shopping again - we're laughing because rents are substantially lower vs. one year ago.
We haven't made a final decision yet but have narrowed it down to 3 houses, all of which sold for around $1.5 - $1.8 million at the peak and are now all renting for under $3,900/month!!!! The one we're leaning towards has completely insane 270-degree city and ocean views.
Also, on each property we request the landlord's credit report and mortgage records to make sure they are financially solvent, and the landlords are actually complying. Most of these rentals have been vacant a good 3-4 months at least, so the owners are desperate to do anything to get them leased.
We figure another 12-18 months of renting for pennies on the dollar and then we'll buy one.
This is a 3000 square footer in a "fancy" gated community, but it's pretty "stripped" as far as goodies/options in the house.
We want a much bigger & nicer/newer house next summer
----
WTF. You have 3000 sq ft and you want a "much bigger" house? OK I can see nice, but bigger...what the hell do you need so much house for?
"WTF. You have 3000 sq ft and you want a "much bigger" house? OK I can see nice, but bigger...what the hell do you need so much house for?"
Well, for starters, we entertain several times a year, with more than 100 people each time. I'm talkn' food catered in, bartender et al.
My kids come home with friends for me to feed & they kinda move in when they are all home from College - we are the house they hang at. They are up all night with the Surroud system full blast (which I want & enjoy!). I'd like all that in a finished basement, which we don't have now. Excuse me, but I like my sleep!
If I can get an SUV for the price of a beetle - why the hell not? Can ya grasp that one'tard?
Today I called a client who manages single family residences, to ask her where rents are going. She said demand is high because of all the tenants and FB's getting thrown out of foreclosed properties, and rents are up slightly.
I told her it was a blip. When the foreclosed houses hit the market as bank repos, there will be more supply.
Also: plenty of apt complex owners are overleveraged. Expect a few of them to go under.
this is getting interesting....
I am asking 1695 per month out side Cincinnati for my 4 bedroom/ 3.5 bath house with nice yard, great schools and finished basement.
I am not desperate to rent it but would like to sell or rent.. which ever happens first.
I want the rent somewhat high b/c I want someone to take care of it. I would actually prefer someone who has kids, decent job and desperate to do lease to own or something like that.
I am renting in Florida until I decide to sell my house in KY and/or have so much money saved I don't mind taking the risk to buy a house in FL.
The rent on this house (plenty of the same model for sale from 285k-350k price range.. I laugh b/c my rent is 1400 per month and they pay for water, lawn care, pest control etc etc. IT's a great deal and all her places are rented out by solid renters/transplants to Orlando.
I am lucky I got a great deal. The house is not bling bling nice but very cute with about 2100 SF. smaller then my house in KY but livable for a few years.
Its all downhill from here in Riverside. The supply of rentals is absurd and price drops and incentives are running wild out here. Even section 8 renters are becomming a hot commodity.
I believe the area is close to the panic stages. The conversation that keeps coming up around here is the economy. We are in deep trouble and people are waking up.
Check out Wells Fargo Reos, they are mounting up!!!
ICEMAN
I am sorry but this isn't a good thing KEITH.
Only an idiot would rent a place from an in-the-red homedebtor.
They lose money on the deal; on a depreciating asset none-the-less.
When the bank forcloses, the renter is FORCED to move on short notice.
THUS, renting from a homedebtor carries HUGE risks versus a renter of an apartment.
Renting from a homedebtor is a losing propostion and only an idiot would do it unless the rent carries a "risk-preimum" discount to offset the possible disclosure
Keith....your comment on this post???
>>>what the hell do you need so much house for?
January 21, 2008 7:50 PM
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LOLOL! I know it's like people now a days need to live in a museum to compensate for their shallowness!
It's soooooo sad to see what people need to LOOK and FEEL important.
"LOLOL! I know it's like people now a days need to live in a museum to compensate for their shallowness!
Yep, that's me - shallow.
Takes one to know one "Princess" !!!! :)
Maybe in a few overbuilt places fueled by speculators. Headline in the SF Chron over the weekend was that rents are up 9% even as house prices have declined a few percent (depending on bay area county). You can't have it both ways - inflation inevitably means higher rent prices.
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