Our Monday, Dec. 16 hour on the perilous state of the American rental market hit a lot of relevant real estate topics, but we thought guest Chris Herbert of the Joint Center For Housing Studies at Harvard University had the clearest explanation as to why rents are rising:
“Well, I think it’s a basic question of supply and demand. When you have that many more renters coming into the market looking for housing, and the supply of housing isn’t responding as quickly as it might, that’s gonna push rents up, even if incomes are low. There’s that many more people out there competing for that housing and it will help rents go up.
[Our housing stock] hasn’t shrunk. It’s a question of whether it’s owner-occupied or renter-occupied, and one of the things we did see meeting that demand was a huge shift of single family homes from the owner occupied stock into the rental stock. SO between 2007 and 2011 we saw three million housing units switch tenure. So that certainly helped.”
Herbert was a lead author on the 2013 JCHS report, “America’s Rental Housing: Evolving Markets and Needs,” which is worth a read if you have the time. Are your rents on the rise? Have you seen the larger market forces at play in your own city, town or apartment building? Was Jimmy McMillan of the Rent is Too Damn High Party in New York right? Let us know in the comments below, or on Facebook, Tumblr and @OnPointRadio.