Many think of only the homeowners when they hear of the record number of foreclosures across the country. However, it is often the renters that pay in this brutal real estate market. Many renters, for example, have been evicted from their homes because the owners of the homes in which they are living are foreclosed upon. Many times, it is the renters that receive a notice of eviction, not from their landlord, but from the lender that foreclosed on the home. And, unfortunately, many of these renters find themselves without homes and without their security deposits. In addition, because of the high foreclosure rates, many cities, including San Antonio, have seen rent prices increasing sharply and vacancy rates dropping.
Across the country, vacancy rates are down from the last year and rent has increased 5.3 percent, up from an increase of 3.1 percent in 2007, according to the National Association of Realtors. Some cities have even seen rent prices increasing into the double digits. San Francisco, for example, saw the median rent price rise 14.6 percent to nearly $1,810 a month in the first quarter of 2009. Washington, D.C. rent prices rose five percent and Seattle rent prices rose nearly 11 percent during this time.
The National Multi-Housing Council also reported that the number of renters in professionally managed apartments leapt to their highest levels in 2007. In fact, the increase in 2007 was as large as the increase for the previous five years, combined. Because of this sharp increase in the number of renters, it only makes sense that the San Antonio rental marketis very strong – and very competitive. Why the Demand for Rentals Remains Strong:
- Renters are waiting for home prices to hit rock bottom. Amazingly, many renters still don’t think the real estate market has hit rock bottom, and they are still waiting for prices to drop even further. Renters are therefore keeping a close eye on the market in hopes of snagging the best deal.
- Many renters simply can’t afford to purchase a new home. This is because the rough economy has slashed many individuals’ incomes, and has left many people either unemployed or under-employed.
- Credit is still hard to obtain. Only individuals with the best credit are getting mortgages right now, which leave many individuals with no other choice than to rent.
- Foreclosures are still on the rise. Individuals who have been foreclosed on their homes simply have no other choice than to rent because of their precarious financial situation and their poor credit.