Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
I saw this Associated Press story in my local newspaper and found it on the MSN moneycentral website. You can read the whole article here:
Housing downturn is a boon for some renters: Associated Press Business News - MSN Money (http://news.moneycentral.msn.com/provider/providerarticle.aspx?feed=AP&date=20080604&id=8730 660 - broken link)
In summary the article says renters are making out in the housing slump because people who can't sell houses/condos are renting them, giving renters more options and forcing luxury apartments to give incentives (cheaper rent, no big renewal increases, a month's free rent, etc.) to get your business. But it also says renters beware. Those cheap houses you may be renting may wind up in foreclosure. It's a good article.
I think that is mostly true in areas that are in econmic downturn besides housing. I think you have to remember that people need a place to live and many those people moving to other areas need a rental or lease for a time;those displaced from foreclosure will be renting and those that now can't buy because of tightening credit will be renting.Then many of the forclosures are held by banks and other lenders that will not lease or rent out.More people looking to rent in a area with a good economic outlook means shortages. In areas where the ecomony is in trouble that means more of rentals available.
I see. Well, they are going to have a hell lotta inventory on their hands. Especially with stricter lending standards now, I wonder how that's going to pan out.
The banks are not in the rental business. They will auction off the homes eventually.That will be good for renters that want to move to homeownership.
No, not really. When/if the downturn in real estate ever begins to go up again, people aren't going to want houses that are crumbling, falling apart, are insect infected, small animal infested, have/had squatters, etc. However, if the banks were to get off their @sses and rent them out, make sure they're kept up, they could not only get $$ for them now (instead of allowing them to basically lie fallow), but they could insure that they were in relatively good condition when the time comes to sell. Otherwise, they're gonna be screwed.
No, not really. When/if the downturn in real estate ever begins to go up again, people aren't going to want houses that are crumbling, falling apart, are insect infected, small animal infested, have/had squatters, etc. However, if the banks were to get off their @sses and rent them out, make sure they're kept up, they could not only get $$ for them now (instead of allowing them to basically lie fallow), but they could insure that they were in relatively good condition when the time comes to sell. Otherwise, they're gonna be screwed.
I've always agreed with this stance.
However, the give and take to a rental arrangement is that the bank has to spend inordinate amounts of money under that agreement.
- Staff to maintain each home (which they would have to hire or contract)
- Cost of maintenance (supplies, hourly wages)
- Asset management system to track each home's status (rented/not rented/for sale/not for sale/long term/short term/etc)
- Management company to handle rent payments and maintenance requests, as well as evictions
Etc and so on. The banks don't want to foot that cost.
Now what I would do, and this is a business strategy I thought about going in, is sell foreclosed/REO homes to a central housing management company, who will give the banks a percentage, perhaps 75%, of the bank's true asking price. That company can then invest a small bit of money to renovate each home to a basic livable standard, then turn around and rent them out or even sell them for 150% of what they bought it for.
revelated, if I ever win the lottery, you and I are going into business together!
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.
Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
Seems to be case of them cutting off their nose to spite their face.
