Published On: Sat, Sep 2nd, 2017

Renter Occupied Housing Continues To Grow

When you think back to what happened to the housing market in 2010, it’s not surprising to hear that more and more people are renting. What might be surprising, though, is that the number of owner occupied properties has remained steady since that time. According to statista.com, the average number of these properties between 2010 and 2016 is approximately 75.44 million. In contrast, the number of rental properties has increased from approximately 38 to 43 million in the same time period.

 

This significant growth opens up several questions, but it has also opened up some interesting business opportunities. As the number of people looking to rent property goes up, this paves the way for both developers and property investors. It also poses a number of questions regarding customer choice. Do tenants have ample choice in this market, with landlords fighting over them? Or can businesses still pick and choose who they rent to?

 

More and more renters are seeking high quality and affordable properties. It would seem this might create a greater level of competition between rental-home businesses to attract them. In fact, three such property companies have recently merged to create the biggest landlord in the marketplace. BlackBlackstone Group, Invitation Homes Inc. and Starwood Waypoint Homes have come together. This creates a single brand (Invitation Homes) rental-home business to serve several states.

 

What does this move mean for renters? Potentially it’s good news. A single institution normalizes typical landlord practices. It builds expectations for renters when they look for a new property. They know what to expect. It might also raise the bar for the thousands of small businesses or private landlords. Tenants will expect them to deliver a better, more professional service.

Renter Occupied Housing Continues To Grow

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Is this continuing rise in renter occupied housing signifying trouble for affordable homes to buy? Without more detailed research of current trends, it would be difficult to clarify a single reason. However, owning a home comes with many risks and perils that young professionals seem to be avoiding. Aside from the cost of the repayments, there are many more expenses a homeowner must pay for. Perhaps reducing one’s responsibilities is a sign of social change rather than an economic choice?

 

The geographic location of the rental properties might be another factor. As working hours increase, many young people are keen to live in the cities where they work. A potential shortage of affordable homes to buy would certainly steer them toward renting. Multi-occupancy can also reduce the costs of rental. It avoids a two or three-decade shared mortgage commitment too. It is thought there may also be fewer long-term relationships that evolve toward starting a family and home ownership away from the city too.

 

It would seem that businesses involved in real-estate investments or family-home rentals might be enjoying a bit of a boom right now. Indeed, as the number of rental properties increase, then potentially the number or renters and landlords can grow too. There will undoubtedly be stiff competition from the big landlords in the business, but for now, it seems this is a good place to invest your money.

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