Being a former hack myself (among other things), I'm prone to skepticism when it comes to mainstream journalism and this article does not really tally with the feedback we're getting here on BP.
FYI, we don't do buy and hold stuff ourselves.
So here's my question, how many of you agree or DISAGREE with this article as far as renting property in your area goes?
Thanks for the input.
In our market we have about 45% or so of our population that rents so we dont really see a shortage of renters in our market. There is always someone willing to rent here.
Definitely true in our Market. My son told me last week they raised their rent again, second time in just one year. Total increases for the year was something like 20%. And the leasing agent at their complex flat refused any negotiation.
I've seen vacancy number around 1%.
One city here recently passed an ordnance limiting hotel stays to 14 days. Some folks were living in hotel rooms.
Lots and lots and lots of construction here. So I'm sure there are lots of folks from other areas here for construction jobs. But I also think this will alleviate the crunch for rentals as these properties come on line. Lots of apartments under construction all over the metro area.
Could it be that companies like AH4R, ARP, Blackstone, etc. are reporting that rents have increased BUT in all reality they are ASKING more in rent (in an effort to appease share holders and investors) but not getting it... as in they have hundreds of properties in every market sitting vacant because there operators are required to charge higher than market rents to make their pro forma look like it works...? Or they accept bad tenants who have no intention of paying rent..? In the mean time all the over priced / under rehabbed houses sitting vacant (or needing evicted) is causing a "shortage of rentals"...?
Just a thought.
@David T. I'd also like to know how they come up with there vacancy stats. For example Does a vacancy = any unoccupied house Or is it strictly houses that are rehabbed and on the market to be rented but are currently vacant... big difference.
I definitely believe there are far fewer rentals available today.
I have houses in several smaller towns here in Illinois and I watch all of them quite a bit in terms of where they're priced and how many there are. Mostly because I want to know if there is a glut in one area and if maybe I should stay away. Or if I'm closing on a house and there are no rentals available, if I can get away with listing it on the high side of my range.
There have been some times this year where, in some towns, not a single house was listed for rent (craiglist, mls, trulia, etc). Doesn't mean there were no rentals available (newspaper, yard signs, etc). But not a single SFH available for rent.
These are towns with 10k to 15k people too so it is a bit surprising. When I first started 7 or 8 years ago, you would usually see anywhere from 8 to 15 houses for rent in these areas.
So I would definitely say there's a shortage.
And it makes sense in areas that I'm in. They're not big enough for any of the big time funds to come in to and yet the foreclosures hit here too so those same people that lost their homes are wanting to get into another house.
@ryan mullin, you make a few good points and by way of answering, i have no idea where the hedge funds and/or wall street get their numbers. All i can tell you is that they have access to very cheap money and their investment perspective is invariably different to anyone on here?
However, i will say that a lot of people in the Atlanta market have been complaining about a lack of "good" tenants.
Very few rental units in our area and lots of good tenants. Rents are way up. I have to agree with the article.
Rental market super tight in my market. Lines waiting to apply at rentals and over 100 hits on last ad. Big rent increases between tenants.
I have been managing the same apt complex with 112 units in my area for the last 9 years and I never had/have any problems filling them up. Our vacancy rate has been less than 1%. Every year we have raised rents, not aggressively, but we have . From my experience, I have to agree with this article.
I can only speak for NOLA, but there does appear to be a rental shortage here. People certainly complain about it all the time. I personally have seen rents go up in the three years I've owned my duplex and I always have a few dozen responses when I advertise a vacancy.
We also have some very localized factors that augment this. In just a few years time, NOLA has added a huge and new industry to our town...movie production. I swear, I sometimes feel like I see more cars with CA license plates than LA ones, lol. It has definitely brought in an influx of renters. In fact, one of my neighbors is an out-of-state landlord and he prices the rents for his duplex at higher than normal, but for shorter terms. Most of his tenants have been in the movie industry.
Of course, tourism has always been one of our biggest industry and the last few years...at least in certain areas...have also seen more and more landlords turning their rentals into vacation rentals instead of the more traditional long-term type of rental. Which in turn, means there are fewer rentals available for residents.
I think as always it depends on where you are market wise. I know single family home some areas with a high transient population there are not enough homes. Other areas were the transient population is not as high its alot lower.
That being said over the 3 markets I own in. I have not had a single problem renting my houses out!
It definitely depends on your market. STL there are some areas that there are lots of rental and lots of people that want to rent.
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