One Sign the Housing Bust Could End Soon

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Yes! I just moved out of an apartment that I had been renting for ten years. My rent was increasing by 25 dollars a year, and maintenance issues were driving my electric bills up. Add in a few bedbugs and some faulty plumbing and presto!- another home owner is born. The trick is to change your expectations as a home buyer. While HG-DYI TV shows would have you believe that you simply can not live without granite counter tops, three bathrooms, and a warren of bedrooms, the truth is that there are a lot of nice little homes out there that are completely suitable for people who are now renting. For example, U.S. cities are full of those cute little Cape Cod houses constructed for soldiers returning from WWII. Because they are small, they are considered to be obsolete by many buyers and so are selling for dirt cheap. I got a nicely maintained cozy little house for 25% less per month (with taxes and insurance) than I was paying in rent. Because I have a fixed mortgage-- I only have to worry about raising taxes. If I find that I can not live there in two or three years... Well I will just take advantage of those raising rent prices and rent it out.

Jennifer of OH 3:57PM September 19, 2011

you need to go all the way back to reagans big scam we are still waiting for the trickle down it was the begining of the end for the middle class the people who paid most of the taxes the rich dont pay the poor cant pay and the middle class is all but gone when will the republicans figure out we need a middle class in this country making above poverty wages before we ever begin to right ourselves.

jim hepner of VA 4:34PM June 16, 2011

This writer is backwards. When housing purchases were flourishing, there were less rentals available - so they price went up. With the crash, Legislatures put prohibitions on renting a foreclosed home (on the bank) to keep rents artificially inflated (Check CA law, for example). The sudden influx in houses that could not be sold, or were foreclosed on, would have drastically reduced rental rates - as more supply was available. Thus, the basic premise of this wanna-be-economist is flat wrong, leaving the balance of his article unworthy of the time it takes to read.

Russ of CA 7:01PM April 03, 2011

The article is all about theories. Yes the rents have gone up, but it doesn't mean that renters would soon prefer to buy houses. Jobs are still scarce. Prices are going up. People just don't have money!!! Those who had money had their wealth wiped out by the recession.

Mickey Mouse of CA 1:26PM April 02, 2011

Many millions of people who before the crash could have qualified for a loan no longer have any chance of getting a loan, as their credit is shot. Seven years before the bad marks go away and the bad marks cannot be erased until those people get jobs and start to get back on their feet. So another seven to ten years before things recover, unless the Democrats and their reckless spending (TRILLIONS) have already damned us all.
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Thanks Democrats !
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real world of MN 10:09PM March 31, 2011

I'm very familiar with the rental market. For owners of rental property, most had to endure a significant decline in the amount of rent charged when the economy dived after September, 2008. Even now, rents have not regained the lost ground.
Owners have mortgages and other obligations, so contrary to what many think, many owners of rental property are not mini Rockefellers. It's truly unfortunate that many who had good paying jobs have lost them. I wanted to add a little perspective, that it is not only those who have lost jobs who have lost income in this ongoing recession.
One significant reason that rents have risen is that many who might have purchased a home find it more difficult to buy as lenders are not making the ‘easy loans’ of the past. In the long run, it is more sensible as we truly don’t want to have a repeat of the last housing bubble.
Do I have expertise, yes, about 30 years worth.

Observer of WA 12:33AM March 29, 2011

just how do you think this rent rise is a indicator of the economy make little or no sense. Take a look at the number of people that lost there homes for one reason or another. Job market shifts not to mention a few. Just what makes you a expert in this field?

Joseph D. Hickenbotham of NY 5:51PM March 28, 2011