I've been noticing "for rent" signs are sprouting roots near me. Some houses have had for rent signs out front for months. I checked to see what they were asking and it seems in line with what houses were renting for earlier this year. But rents are falling. Everything I read says so and everything I see would seem to confirm it.
Why?
1) Investors are flooding the market with rental properties, especially in the low cost areas east of the 215 fwy. A large percentage of sales are still going to investors so the inventory of rental properties is still increasing.
2) High unemployment means people are sharing or moving in with family members. This lowers the number of potential renters.
3) The housing credit and low cost FHA financing is taking many of those renters and making them home owners. Those that do have jobs can buy a house and in many areas the payment will be equal to or even less than renting.
This trifecta has got to be taking a toll on the rental market and it will continue to for quite a while. Will the investor rental market take a dump? Or are they picking them up at a price where they could sell them and still make a buck. In many cases I think that's what might end up happening. If the employment situations stays bad for a few years we may see a lot of these rentals up for sale. I'm sure a lot of the newbie investors will get burned. The experienced ones will probably make out like bandits.
And on a totally different note, here's a video that should really tick you off. Another morality issue? Or is this just theft?