Renting a home is a substitute for owning one. House prices have been rising so that means that the demand for renting homes will increase. And when demand increases, ceteris paribus, price will increase. That is lesson I seen in this article:
Houses Too Expensive to Buy Underpin Lofty Rents: Single-family home rents are rising more than apartments this year by Will Parker of The WSJ. Excerpts:
"Big public companies that rent out single-family homes are beating the rest of the rental market this year, thanks to tenants who are paying large rent increases on the sorts of homes they increasingly can’t afford to buy.
LandlordsTricon Residentia, Invitation Homes and , which together own about 180,000 rental homes, each posted rent increases greater than 6% for the third quarter over the same period a year prior.That was about twice as much as the average increase for rental homes in September, compared with the same month last year, according to separate indexes from data firm CoreLogic and online-listing company Zillow.
Tricon Chief Executive Gary Berman attributed his firm’s gains in part to record-high home prices that are steering more would-be single-family home buyers toward rental houses.
“In such a distorted environment for home buyers, the case for rental is more compelling than ever,” he told investors and analysts earlier this month."
"Apartment rents shot up about 15% in 2021 and continued rising at an above-typical pace in 2022. That growth has been moderating and has even turned negative compared with last year, according to some metrics, as record new apartment construction has helped slow apartment-rent advances in many parts of the country.
, a publicly traded apartment landlord, reported a 2.2% decline in new-lease rents in the third quarter, compared with the same quarter a year ago.Rent growth for rental homes has also slowed since hitting a peak in 2022, but it is proving more resilient. Houses for rent are benefiting from the least-affordable home-sales market in many decades, a result of sale prices reaching new highs and mortgage rates hovering near a two-decade high."
"The average mortgage payment is now 52% higher than the average monthly rent check"
Related posts on supply and demand:
Orange Juice Prices Are at Record Highs—and Could Keep Climbing (article illustrates supply and demand principles) (2023)Apartment Rents Fall as Crush of New Supply Hits Market (2023)
Egg Prices Surge to Records as Bird Flu Hits Poultry Flocks (2022)
How Supply And Demand Have Affected Beef Prices Recently (2017)Is There A Booze Shortage? (2022)
Car makers face ‘chipageddon’ (2021)
Does the U.S. have a firefighter shortage (2021)
There is no truck driver shortage in the US (2021)
Is there a shortage of homes? (2020)
Why honey prices have climbed about 25% since 2013 (2019-This post is featured in Introduction to Microeconomics by Luís Cabral. He is chair of the economics department at New York University.)
Is there really a shortage of construction workers (2019)
Was there really a shortage of meatless burgers? (2019)
Is There A Christmas Tree Shortage? (2017)
Is There Really A Honey Bee Shortage? (2013)
Will There Be A Pumpkin Shortage This Year? (2011)
Introduction to Microeconomics by Luís Cabral
No comments:
Post a Comment