Renters Say They’ll Rent Forever As Housing Market Gets More Expensive

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If north of 40% of homes are owned by Boomers. And an estimated 40% of Boomers will need long-term care at an assisted-living facility according to Medicaid. Won’t the housing market radically change over the next decade?

ChesterD

There’s a flip side to this story. Rental prices will also go up over time. I reluctantly bought before the 2008 housing crises. Today my bond is almost paid off and my repayments and expenses are about half of what it would cost to rent my place. Time will tell how the housing market behaves.

Tokogogoloshe

This survey involved 308 people…not 3,080, not 30,800, not 308,000. Just 308. I don’t think that’s an effective sample size to accurately understand most American renters’ outlook on the housing market.

ImOutOfMilk

The thing that really sucks about renting is that rent price is directly correlated to the rise in housing prices; the higher the price of the house, the higher the mortgage, the higher the mortgage, the higher it costs to rent. Truly a vicious cycle.

Shaqtothefuture

But why is this happening *now*? Some thoughts… * Yes, interest rates are low, that is causing people to bid up prices because they can afford more house for the same monthly payment. Are the rates the lowest ever? And was this basically a gift to boomers, because now, as they cash out of their homes, they can realize much larger gains? * Yes, there seems to have been a lull in house construction over the past decade, but why did the effects from this materialize almost overnight? * Yes, there has been a continual re-shifting in the economy, with jobs leaving middle America and pooling in a few hot metro areas, many of which are anti-housing and/or have anti-housing legislation in place (Proposition 13 in CA, Proposition 2.5 in MA), but this has been happening for 15+ years. * Yes, COVID has changed things, it suppressed sales for a year, they likely came raging back with twice as much demand the next year. It also made seniors think twice about selling their homes and moving into nursing homes (which were COVID death traps). On the other hand, we have a million less people living due to COVID, many of whom were elderly, so why isn’t that boosting inventory? * Have there been any robust studies of the corporate homebuying impacts? Corporations have always owned houses, but it seems like this has really picked up. But why now? Why is rental housing now a smart “investment” for corporations? Have algorithms developed to the point where it has made this kind of buying more targeted and concentrated? * How has demographics affected the housing market, and why haven’t we seen an impact from this before? (or have we?). Are we seeing an impact from the Boomer Echo generation (aha millennials, born between 1982 and 1995) reaching house-buying age? * Rental housing is important, because it gives a region a lot more worker flexibility, and provides younger people with the ability to live without anchoring themselves. It is also important to have a good supply of affordable housing, because service industry workers need somewhere to live too. I have a 2nd home in a vacation-type area which is experiencing a huge shift, with many seasonal homes shifted into full-time homes (thus depriving renters of housing). One service professional I use is living in a motel, paying $125 a night off-season, which is absolutely insane. This guy is almost homeless. And although everyone recognizes the need for more housing, * Has the inequality in our economy made the housing market infeasible? In my region, the cost to construct a basic small detached house is something like $300-400k, that is absolutely unaffordable for the people who would live in a basic, small detached house. Are we being pushed into multi-story apartment buildings like what you see in Tokyo or lakeshore Toronto? Are such buildings in opposition to the American home-owning culture? Just my thoughts.

MoonBatsRule