The first few months of this year have already passed. With home prices on the rise, affordability is bound to be an issue this year. According to a real estate industry expert, factors such as historical low mortgage rates and better salary figures may pave way for another boom, but there is uncertainty in this regard. And the fact that sales have been going down just indicates that maybe the price is keeping the buyers out of the circle.
So does this affect the rental industry? Probably not, but the same trend can be noted in this sector as well. Renters are facing an increased number of affordability issues nationwide, or so a recent report claims. The results also state that the fact that so many people in the country are not finding housing affordable, is affecting their health especially in families where the income levels are below the average. These people have stopped paying attention to their health and are using up their savings, so they can afford their increasing rents.
The report states that nearly 50% of the total renters in the country pay rental amounts that exceed 30% of their income. Compared to the stats recorded 10 years before, the value now has increased by 12%.
According to the analysts, the number of renters is also increasing because ownership rates are falling lower. The housing market is already aware of this and has made adjustments so that it can cater to the rising demand of single family homes which so many renters are interested in. The stats claim that in the past five years, more than three million homes have now been converted into rental units, whereas previously they were owned residences.
With rental affordability going down, what should property managers aim at? Try to get your vacant homes filled up at the earliest even if it means bringing your rents down. At least that is better than them sitting vacant on the market. If you fear this will affect profits, start renting out shared residences. Not only will your business benefit but even your tenants are going to find the rents affordable.
Follow our advice and hopefully, your business will not be affected by the rental affordability issue.
Source: www.propertymanager.com
