With rising rents, more renters are being swayed into home ownership. Many are finding they buy a home and get the same amount of space cheaper than renting in our region. Affordability in housing is at record highs from the combination of falling home values and record-low mortgages.
Rents are increasing at about the same pace that home values are dropping, says Stan Humphries, Zillow’s chief economist, who says, according to their surveys, home prices have dropped 3.1 percent year-over-year whereas rents have increased 2.5 percent. “Herein lie the seeds to eventually more interest in buying on the part of consumers, which will help put a floor under home prices,” Humphries told Investors Business Daily.
Recent housing surveys, including Zillow’s, are showing home prices are starting to rise in recent months. Since this varies by local areas, how’s your market doing?
Source: “Rising Rents Prompt Buys, May Help Housing Recover,” Investors Business Daily (May 10, 2012)