What's the Solution for Rising Rent Prices?

American Thinker ^ | 05/06/2019 | Larry Alton

[SeekAndFind]

It shouldn’t be a surprise to learn that rent prices are still rising consistently, across many areas of the country. As of March, the cost of rent was, on average, 3.7 percent higher than it was last year (according to the Labor Department, as reported by Realtor.com). Average wages grew about 3.2 percent during the same period, meaning rent is growing faster than wages can keep up with it.

It’s estimated that there is currently a shortfall of 2.6 million housing units for Americans with low to moderate levels of income. Fast-growing urban areas are hit especially hard, with exceptionally high demand and faster-growing rent prices than wages.

So what’s the solution? If you’re left-leaning, you might suggest the development of rent control, regulating the amount of rent a landlord can charge or restricting how much rent can increase from year to year. However, there may be some inherent problems with this approach, and if we’re going to cultivate an economy where everyone can thrive, we need a more comprehensive solution.

Buying vs. Renting

First, let’s consider the fact that many people currently renting could feasibly afford to buy a house -- and in many cases, end up paying far less in a monthly mortgage payment than they’re currently paying for rent. The two inhibitory factors preventing more people from buying houses are an inability to be approved for a loan (due to a low credit score or bad credit history), and not being able to save enough for a down payment. The former issue is difficult to navigate, since banks do need some reassurance that their loans will be repaid. The latter issue is directly tied to rental prices;

[SkyDancer]

The reason could be higher property taxes and maintenance costs. Somebody has to pay them and it’s the renter.

[taxcontrol]

The solution is to increase the number of apartments. Simple supply and demand.

[Cowboy Bob]

Deport the illegals.

[dfwgator]

The answer is obvious, isn’t it, Nationalize Housing.

Council Estates for Everyone!

[entropy12]

Buy a Condo! Many times it is no more expensive than renting, and in the long run you build up some equity.
With renting all you have is rent receipts.

[bk1000]

[glorgau]

I simply don’t want to be tied down to a piece of property.

Over the years, I’ve had two condos and two houses with some acreage, but now don’t even mow a lawn or shovel a lick of snow.

Well worth not having to bother with that stuff. Also, helps keep me from accumulating a bunch of stuff/junk.

Probably move next year into a new complex that is being built nearby in order to cash in on the move in incentives.

[Red Badger]

Cabrini Green 2.0!...........................

[cuban leaf]

I owned my own home between 1978 and 1998. Then my wife dumped me and I found myself renting. This was in the Seattle area.

My new wife and I rented the entire time we lived in Seattle for the simple reason that we could rent a nice 4-5 bedroom home the entire time for around $1400 -$1600. Meanwhile, house prices were going through the roof.

And the reason rent was so low is that rental properties were being drained of tenants because everybody was buying. In fact there was an old joke about the guy that a guy’s credit score was so bad that he couldn’t rent, so he had to buy a place instead.

It was supply and demand. Nobody wanted to rent. We left for Kentucky in 2011. It changed in that short time. Both sale and rental prices are through the roof.

It’s so bad over there that my daughter and her husband, that lived a couple of blocks of Market in Ballard, moved out here last summer. They now rent a MUCH NICER home for 2/3 the price. And the one in Ballard had no parking, and even the street was iffy. They are now in an upscale neighborhood with room for six cars in the driveway as well as a two car garage.

I think that as telecommuting becomes a viable option for more and more people, we will see flyover country increase in population as the cities are drained, left with only the criminal element and “welfare” recipients.

[thoughtomator]

Get rid of the illegals and create tens of millions of available housing units overnight.

[cuban leaf]

I forgot to mention that if we had bought in Seattle rather than rented, our payment would have gone from $1600 to $3600, and then the crash would have put us underwater by $200k.

So renting was better.

And we’re in the midst of a worse bubble than that one. The only reason I bought is because I wanted a farm and the whole bloody thing, 32 acres, new home and large barn, cost just over one year’s income, and the annual real estate taxes are the equivalent of a single month’s payment on a new Toyota Corolla.

[null and void]

Supply and demand has worked every. single. time.

Increase the supply by simplifying the permitting process and not penalizing landlords.

Reduce the demand by deporting criminal alien (for those of you in Rio Linda, in every other case, we call people who break the law 'criminals' not 'illegals') welfare and Section 8 recipients.

[1Old Pro]

Supply and Demand. Less young people are investing in a house.

[a fool in paradise]

End foreign invest in real estate.

[Dilbert San Diego]

You touch on how people make different choices about housing.

There is no “one size fits all” situation with housing.

I’ve known people who would never own a home or condo, even though they could afford same, because of maintenance headaches, and not wanting to be tied down.

And I’ve known people who bought a series of houses over the years, moving up so to speak, as their incomes and equity in the properties rose, enabling them to buy more expensive homes.

[JimRed]

I think that as telecommuting becomes a viable option for more and more people, we will see flyover country increase in population as the cities are drained...

But the relocated city dwellers will bring their unfortunate voting habits with them, and wreck their new locations.

[9YearLurker]

Thomas Sowell has been on this for decades. Less NIMBY regulation.

Also, of course, no public unions with their inflated contracts. Could be we need a whole wave of municipal bankruptcies to get beyond their coercive hold on our local taxes.

[IronJack]

Millennials are too immature to buy houses. So they either rent or live in mom's basement.

They're also anti-capitalist, so they shun private property. They're perfectly content to pay for someone else's property.

[wally_bert]

Condos are poor settings for a sitcom though.

I bet no one remembers the short lived comedy of Condo.