Do you have to move this year? Are you military or government under orders? Here’s some broad brush stats that you can put into your tool kit when deciding what to do….stay tuned for more.
The source of the information from this blog post is Steve Murray, President REAL TRENDS during a brief to the National Association of Real Property Managers (NARPM) Broker/Owners retreat April 2016.
1. Demographic trends indicate that the growth of renter occupied single family properties is the largest in the last 50 years measured by percentage and total numbers. Home ownership rates peaked in 2004 at almost 69%; today the ownership rate is 63.5%. This doesn’t seem like a large drop, but this translates to millions of families who are now renting and not buying properties. The Joint Center for Housing Studies estimates that renter households grew by over 9 million between 2005 and 2015. As reported by Real Trends, there are 42 million renter households in the United States at this time.
2. Millennials have always been a good source for renters due to their young age, general unwillingness to put down roots, or transitional point in the their lives. But the fastest growing segment of rental households is the over 50 age group where the rise is by almost 5 million over the last ten years. This accounts for over half the rental household growth over this time. This age group is typically stable and may be looking for more of a long-term lease.
3. Around 48% of households who move from a single family rental also tend to move to another single family rental. The issue is affordability, which is a large and growing issue among owners and renters. This issue is most critical in large Metropolitan areas in coastal markets like Washington D.C.
Do all of these numbers mean that you will have absolute success with being a landlord? Does it mean you will find the perfect tenant that will treat your house well, pay on time, and give you proper notice before vacating a perfectly clean and maintained property? No, of course not. But the trend is going against home-ownership and towards renting for the time being, which anyone can exploit by renting out their property at least for a few years while keeping an eye on the housing market. This is a great option, especially for a homeowner that owes more on his or her house than it’s worth and does not want to resort to short sale, foreclosure, or coming out of pocket during closing.