Renting: Renters "Dig Deeper " in 2007

USA Today has a front-page story about the continuing rise in rents in many markets as the housing market slumps:

With the projected rise of 5% this year, rents would be 14% higher than at the end of 2004, the report says. Over the same period, paychecks are expected to rise 4%, adjusted for inflation. The widening gap is likely to worsen the crisis for workforce housing, especially in coastal cities, says Hessam Nadji, a managing director at Marcus & Millichap, a real estate investment brokerage. "This is a national trend. We're seeing rents rise in the majority of markets, and we see this continuing for at least three years.

The article correctly notes that the continuing spate of "condo glut" in many overbuilt markets will help ease things for renters, as the flippers are stuck paying two mortgages that they can't cover and need income fast. Let me take this opportunity to link to a recent Bubble Meter post discussing the flopping condo/lowering rent syndrome in that most overheated of markets, the Big Apple.

Posted at February 5, 2007 01:24 PM

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USA Today has a front-page story about the continuing rise in rents in many markets as the housing market slumps: With the projected rise of 5% this year, rents would be 14% higher than at the end of 2004, the report says. Over the same period, paychecks are expected to rise 4%, adjusted for inflation. The widening gap is likely to worsen the crisis for workforce housing, especially in coastal cities, says Hessam Nadji, a managing director at Marcus & Millichap, a real estate investment brokerage. "This is a national trend. We're seeing rents rise in the majority of markets, and we see this continuing for at least three years. The article correctly notes that the continuing spate of "condo glut" in many overbuilt markets will help ease things for renters, as the flippers are stuck paying two mortgages that they can't cover and need income fast. Let me take this opportunity to link to a recent Bubble Meter post discussing the flopping condo/lowering rent syndrome in that most overheated of markets, the Big Apple.