Recent reports have shown home prices rising, especially in the housing markets which were hardest hit in the crash.
Investors, buying in bulk, have been swarming these distressed markets, seeking to take advantage of a thriving new single family rental market.
The strong demand from investors has pushed supplies down, causing prices to rise. But as housing recovers, and more fence-sitters decide to jump in, will the rental market remain strong?
Rents are still rising.
Nationally, rents rose 4.7 percent in August from a year ago, which, while still a gain, is down from the 5.8 percent annual increase in May – making it the slowest rise since March, according to Trulia.com. Some markets, however, are still hot, with rents up around 10 percent year over year. These include Houston and Seattle, Denver and San Francisco.
“Rents had been on fire earlier this year, but some of the hottest rental markets are starting to cool,” said Jed Kolko, Trulia’s Chief Economist. “New construction that started last year is finally coming onto the market, giving renters more choices and some relief from rising rents. Still, rents are climbing in nearly all of the major rental markets.”
A new report from Rent.com quantified many of the reasons potential buyers are delaying home ownership: 47 percent are waiting to save a down payment , 11 percent are waiting for the real estate market to stabilize, 22 percent are waiting for their credit to improve to qualify for a home loan, and 20 percent are waiting to feel more secure about their employment situation.