Housing Bubble Burst Increases Demand for Rentals
Digested from “More Americans Are Renting, and Paying More, as Homeownership Falls”
The New York Times (6/24/15) Searcey, Dionne
The multifamily housing industry is experiencing a 20-year low in vacancy rates and rise in rents — especially in high-cost markets such as Washington, D.C., and San Francisco, where job growth has been greater.
This dramatic increase in renters is due to the housing industry's difficulty in bouncing back, in part because it’s nearly impossible for large portions of the population to afford a home. For example, millennials, many of whom should be in prime home-buying years, are having difficulty finding work and are saddled with student debt that makes it difficult to save for a down payment. Former homeowners who purchased during the boom and were forced to foreclose don’t have the credit scores necessary to qualify for a loan.
Reluctant renters are looking to find avenues toward homeownership, though, so expect to see home buying continue to climb slowly.