We know that you rental property investors get upset when you hear about rising prices, but when rents are rising, it’s great news. In an article at msnbc.msn.com titled “Office and home rent will keep rising and rising,” it’s fun to read that both residential and office rents are rising. They are expected to continue rising into the future.
Home ownership has sunk to historic lows, and demand for rental properties continues to rise. Rent for a primary residence increased 2.5 percent in December 2011 compared to the same period a year earlier. One research report states that rents are at their highest level since 2007. They reached an average of $1,009 per month last year. At the same time, the vacancy rate dropped from 6.6 percent to 5.2 percent last year.
Rising rents and very low interest rates are making home ownership much more affordable. However, tight lending requirements are keeping would-be buyers out of the market. A great many others, including younger buyers who would be first-time buyers, are not willing to get into the market until prices stabilize and foreclosure inventories begin to shrink.
Analysts believe that this reduced supply and increased demand situation will continue for several more years, as new homes aren’t being built at anywhere near normal rates. Also, lending is expected to remain tight for a while as well. A push toward higher residential rents is expected for at least two more years.
With home prices in the gutter and interest rates hitting another historic new low this week, single family rental property investors can cut some really amazing deals. These conditions mean that positive cash flows are assured, and rents can be adjusted upward into the near future. Of course, getting the right property and marketing it at a small discount to competing higher rents can keep it occupied longer and more than offset the slightly lower rental rate.
We know that you rental property investors get upset when you hear about rising prices, but when rents are rising, it’s great news. In an article at msnbc.msn.com titled “Office and home rent will keep rising and rising,” it’s fun to read that both residential and office rents are rising. They are expected to continue rising into the future.
Home ownership has sunk to historic lows, and demand for rental properties continues to rise. Rent for a primary residence increased 2.5 percent in December 2011 compared to the same period a year earlier. One research report states that rents are at their highest level since 2007. They reached an average of $1,009 per month last year. At the same time, the vacancy rate dropped from 6.6 percent to 5.2 percent last year.
Rising rents and very low interest rates are making home ownership much more affordable. However, tight lending requirements are keeping would-be buyers out of the market. A great many others, including younger buyers who would be first-time buyers, are not willing to get into the market until prices stabilize and foreclosure inventories begin to shrink.
Analysts believe that this reduced supply and increased demand situation will continue for several more years, as new homes aren’t being built at anywhere near normal rates. Also, lending is expected to remain tight for a while as well. A push toward higher residential rents is expected for at least two more years.
With home prices in the gutter and interest rates hitting another historic new low this week, single family rental property investors can cut some really amazing deals. These conditions mean that positive cash flows are assured, and rents can be adjusted upward into the near future. Of course, getting the right property and marketing it at a small discount to competing higher rents can keep it occupied longer and more than offset the slightly lower rental rate.