More people moving out and renting
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Kai Ryssdal: There were some new foreclosure numbers out today. Lousy is about the gist of it. But you know, when the housing market first went bust, a lot of people figured it would be good for the rental market. Can’t afford to own, the theory went, so you go rent. What really happened was that things were so bad, people didn’t rent either. They doubled up with friends. Or moved back in with mom and dad. Now, though, it looks like people are finally deciding it’s time to move out again.
Marketplace’s Alisa Roth reports.
Alisa Roth: The big reason people are starting to rent again is jobs. Mark Obrinsky is chief economist at the National Multi-Housing Council. It’s a trade association for the apartment industry. He says it’s not that the job market has gotten so much better; it’s more like people have decided it’s not getting worse.
Mark Obrinsky: They’re less worried about losing a job they currently have than they might have been a year or two years ago.
So they feel sure enough about their situation to ditch the roommate or move out of their childhood bedrooms. Obrinsky says the fact that new jobs are so hard find also makes renting more appealing.
Mark Obrinsky: A lot of people want to maintain some flexibility, because they’re willing to change locations to find a good job, and they don’t want to be stuck with a mortgage on a house that they can’t sell.
The other reason more people are renting is that fewer are buying. All those incentives that were supposed to encourage people to buy have expired. Sam Chandan is chief economist at Real Capital, which is a real estate market research firm. He says now there’s one fewer reason to buy a house.
Sam Chandan: That draw away from rental demand is no longer a significant factor in undermining rental outcomes. It’s helping to stabilize demand in the rental space.
So far, the data on the rental market looks good. One recent report says the number of occupied apartments increased more in the first half of this year than in all of last year. And if you’re wondering what this says about the economy, economists say it’s a good sign people are confident enough to move out.
In New York, I’m Alisa Roth for Marketplace.
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