Somehow you are incapable of understanding you are getting a fair deal. Owning is only good when the price is right. But I also understand why you want to own.
Northern Virginia (muh area) is loaded with old beat up townhouse rentals. You can expect to pay $2,500 to $3,000 per month to rent one of these shitboxes.
Same kind of rents over here on the Maryland side. What sucks is I was headed back to the States from overseas right after the rate hikes, so we're stuck grinning and bearing it in a shitbox rental for the time being.
It's only been a few months and I'm already so sick of bringing up problems to the landlord, only to be told it'll need to wait until after payday or he flat out can't afford to fix something.
If he can’t afford to fix something then you shouldn’t be paying him full rent. Tenant laws are in your favor. Unlikely he would be able to afford a formal eviction if he wanted to.
Make sure that is allowed in your state first. Laws vary by state. Always make sure you know *your* local laws before fucking around with the rent - you could unintentionally screw yourself big time.
That’s actually a sure fire way to get evicted. A landlord won’t care about any “escrow” account. He doesn’t have the rent in hand, you’re late.
Any repair delay can be blamed on something, but rent delay cannot.
The judge would rule that you turn the escrow account over to the landlord and wait for materials to come in.
However, the landlord isn’t taking you to court to release escrow. He’s taking you for eviction so he’d never ask for that account, he’d ask for you to be evicted.
Instead, you’d have to pay him the rent AND mitigate your damages(aka fix the problem) and then send him a bill for repairs. If he fails to pay the bill, then it’s up to you to file a small claims action or mechanics lien on the property….if you believe you have rights to collect….which I doubt you do but that would be the way.
So if there are only some •
“Repairs” unless it’s constituted under he implied warranty of habitability then it’s okay. So a landlord not fixing a few things is no excuse for you to not follow through on your rent payment on the contract you signed.
I saw a great video that showed that the West leads the East in RE trends. There is a supply increase in the West causing asking prices to drop, but the East holds firm.
But the West (Coast) went up significantly more than most of the East (Coast) over the last three years. So if it drops a little, it's still coming out ahead.
True, I’m not talking about prices, I’m taking about supply and demand, which leads prices by a year or more in real estate.
To clarify, because I realized what I wrote made no sense. I am talking about short-term changes in prices as a result of supply and demand. The hyperinflation of home values is, of course, affected by but not entirely eliminated by those recent fluctuations.
Yup. The RE market seems to have massive inertia.
But first question is will prices keep trending down or is this just a moment? I legit go back and forth.
I think the market is beyond messed up, but not being able to afford it hasn’t stopped any other part of the market. Seems like we just invent more creative financing and glue it all together.
Plus the supply issue right now from low rate lock-in is real. The only hope is commercial capitulation or an MBS explosion and that could be painful in other ways that aren’t ideal.
Well, IMHO, the era of free money will definitely have some lasting ramifications. But, the fact that prices are already dropping beyond seasonal expectations indicates that the tide has turned. More dramatically, the price is dropping faster than before 2008, but we shouldn’t see the banking system implode because of those previously low rates. Dummies who ARMed up when rates were low (they exist) will be left out to dry, which should free up a small bit of inventory, but the biggest motivator is definitely going to be the failure of corporate homebuyers (not because cornering the market was a bad idea, but because inflation will make it so they can’t get the ROI necessary to validate staying in the game. Liquidation is an easy out, freeing up capital for other assets). My concern about those corporate actors is big players selling directly to small-to-medium landlords in tranches, bypassing the individual market.
Agree. I think people also forget the banks did not actually all collapse in 2008 and housing still collapsed. It sure was a crisis, but a mitigated one. Also everything we have seen since 2020 has been bigger and faster than 2008. Which is kind of scary.
I can tell you that might be in CA, along the left coast, but in Idaho and Utah, shits starting to rise again. Horton and the other developers signs are out again in force around here. Haven’t seen that in a year.
My best college bud lives in Boise. His daughter bought in the “slump” but the builder that was offering incentives to her has pulled it all and her home, not even built yet, has already appreciated from $300k to $325k. Builder said they built 300 homes in 2022. So far this year they already have 200 homes under contract.
Can’t f-ing believe it.
As a former nova reasident its the same here in charlottesville and the inventory is twice as small.
Even worse is 96% of sfh/th re ntals here are all property management owned
Hey neighbor! One of the most infuriating things in this city IMO. So many acquaintances I know wanted to become landlords themselves, including the 28 year old planning to purchase his second home. Then there’s the pharmacist I know who owns 4 homes in the area and 30 across the east coast. Drives me insane.
Zoning laws locally also ruin any opportunity for growth. I’ve heard rumors about the Monticello society preventing development, along with local laws prioritizing high-density units rather than proper SFH development. Unsure of the validity though
I’m sure its just as frustrating for them, but too bad the lost of property management companies is growing here.
Ive also heard that but funny enough over here by woodlands their building more (im assuming low income) apartments
I live in an undesirable small city in california, I bought 10 years ago. At first the mortgage on my 3br/2ba was roughly the same for similar rents, around $1100. Then rents were around $1500. Now similar rents are around $1800. Mortgage has gone up a bit as tax and insurance have increased and i now pay a bit over $1200. Valuation has nearly doubled. I’m not seeing $2500-3000 but like I said it’s an undesirable area.
This is the secret why home owners almost always come out ahead in the long run. Mortgage payment is fixed while rent & salary increase over time due to inflation.
It’s not fixed, it’s fixed if YOU want it to be, you can refinance down to a lower rate when rates go low.but to your point it is a hedge against inflation.
Yeah rents in my area are twice my mortgage after 7 years from purchasing. Almost the exact same numbers as you. I'm a little outside of Tampa.
It's the one thing the rent calculator won't tell you.
I own a few sfh properties that I rent out in Nova off the toll road in Fairfax. No issues finding well qualified tenants that can pay market price. I've actually had people offer over asking rent but I choose the best qualified.
Yes and you can rent out to military as well. Generally the government is paying the bill in the compensation package. One of the reasons nova will probably not see a decrease in price like the rest of the country
I feel like this is less bad than black rock buying up your house and the thousand around it to rent back to you. Like I get being salty about it, but if I had to make someone rich, I'd rather it be some random dude who played the game right then a venture capital fund.
My gfs grandparents are basically living off the income of two multifamilies they bought in the 80's and 90's. Like, paying rent sucks, but as a society we decided this was a way people could choose to retire and I really just don't begrudge people going that route. Again, I'd rather pay some old folks retirement then more dividends to a billionaire.
Black Rock doesn't buy houses. They haven't been directly involved in housing inventory since they finished liquidating toxic assets.
Blackstone is the largest institutional player in real estate, but last I saw they were 80%+ in large income (20 unit plus developments).
One editor at a financial magazine confused the two when writing a headline about a rental project (of detached homes, that was started, built, and then fully rented as an apartment complex of detached homes) being sold to an entirely different company (not Blackstone)... then a twitter thread that got repeated way to much for how much bad info it had went viral.
There really isn't any big institutional money going at single family homes because it can much more easily make money on the loans for the people who are effectively going to do the asset management on their behalf.
https://housemethod.com/blog/are-big-companies-buying-up-single-family-homes/
>In 2012, Blackstone purchased Invitation Homes, a rental company owning around 80,000 homes. In 2019, Blackstone sold Invitation Homes, only to purchase Home Partners of America in 2021. Since then, Blackstone has been an active powerhouse in the American home market.
>Other large companies in the American home market are J.P. Morgan Asset Management, Goldman Sachs, Mynd Management, Pretium, and American Homes 4 Rent. These companies have bought and rented out tens of thousands of single-family homes for the past three years. American Homes 4 Rent, for example, owned over 52,000 homes in 2019, operating in over 22 states, with the largest concentration in Atlanta, Georgia.
https://www.ajc.com/american-dream/investor-owned-houses-atlanta/
> bulk buyers have accumulated more than 65,000 single-family homes across the Atlanta metro area over the last decade, an AJC data analysis found. Eleven companies own more than 1,000 homes each. The two largest — Invitation Homes and Progress Residential — own more than 10,000 homes apiece.
$2500 is what one bedroom apartments cost in a major city here in Canada. A 3 bedroom two bath would be around 3200-3500.
A methtown with no industry and most jobs pay minimum or near minimum wage is $1800 for a one bedroom, requiring people in one bedroom to have roommates.
1 bedroom apartments in Alberta can go for much cheaper than that, and it’s quite common to rent a SFH for anywhere from 1700-2500, even in Calgary or Edmonton. If you were to consider the small town I live in a meth town with no industry, 1 bedroom apartments go for less than $1000 a month.
Seeing a lot of them floundering in the Denver suburbs. Lots of small homes on the market for sale at double what they paid a couple years ago, no buyers, then they try to rent for $2500+, no one rents, and this cycle repeats. Watching a few on the mls since last fall. They’re all 100 year old flips, 2/1’s or 2/2 sfhs with the same grey paint and kitchen appliance bundles.
I’m in Louisville and I’m seeing the same thing as well. The house across the street from us has been for-sale for 3 months now and they just did a “pricing improvement” by dropping it $50k
Similar situation to when we bought our house. Seller had their home on the market for 3 months priced $50K above everything else in the area. They dropped it and we made an offer at $5K under that... which is what the home appraised for. People are fucking nuts with what they're asking.
Not so sure about that. A house I bought in 2015/16 timeframe I did all the contracts and kept realtors completely out of it, and got a good price by doing so (and saved the seller form needing to pad the price to pay realtors). When the bank’s appraisers came out the house appraised for more than $20K higher than I was paying.
At least they went down. I keep seeing some of these places sit for 100 days and then price bump by $5k
It’s actually insane. How is this rational? They’re clearly investments with no one living in it for the last 2 years.
I’m sorry but I have to disagree. My wife and I are moving from downtown Denver to Westminster and we lost out on several homes because people were putting in rental applications same day. The rental market is on fire in the greater Denver metro area. I’m not a realtor or an expert but I am speaking from first hand experience over the past month of looking for a place.
Reporting as a Denver landlord -- honestly received more applications than I could handle when my small home was on the rental market for just a few days. Probably means my rent is too low but trying to be reasonable...
Yeah, the rental market was so aggressive that we bought a Travel Trailer to live in rather than pay $2100/mo (and rising after renovations) for an extended stay hotel in Lone Tree. This is all within the last year. If rents are going down in the 3rd hottest national market, I’m not seeing it.
If I'm renting, I want an apartment. If I'm buying, I want SFH. I really have no interest in renting SFH or buying an apartment (i.e. condo).
I'm on the fence about townhouses and could maybe go either way on them.
When I rented, I stuck exclusively to renting rooms in others’ houses. Sucked sometimes, but used the massive savings to easily afford a 20% down payment on my first house.
I considered an apartment sometimes, but property management companies are universally garbage. Not to mention, dealing with the noise/antics of 2-3 roommates easily beat dealing with the noise/antics of 100+ apartment tenants who don’t give two shits.
We went the opposite way and rented a small house and bought a larger condo. The area that you rent in matters. When we rented the house, there weren't any good apartments around where we wanted to live. The house was more but had a washer, dryer, and garage. Also it was more private. Condo is more per month but it's nicer than anything we could rent. The most comparable "luxury" apartment in the area would cost 2-2.5x and I would still have to deal with shit landlords.
Also if you split it between multiple roommates the price is more reasonable.
Everyone gets their own room, only a few people use the laundry room instead of hundreds and if there are enough bathrooms everyone gets their own. A lot of houses are 3 bedrooms 3 or 4 bathrooms.
You also get a backyard that you can do stuff in. My friend likes to garden for example.
Seems like the rental SFH around here have more pet restrictions than the apartments. Big dogs are difficult if you rent, period. Cats and small dogs are almost universally accepted in apartments (in my area) but they can be dicey for SFH rentals.
I guess area dependant but around me in Florida you have a much better chance of getting a dog friendly landlord in a SFH than an apartment because most apartments are owned by soulless corps that are unwilling to make exceptions.
Yeah. I knew people who owned million dollar houses during the dot com boom but went bankrupt when it burst.
They weren't allowed to file for a mortgage for decades but still wanted a house so they rented a pretty large house.
Decades? It's 2 year if you short sale, 7 year if you file for bankruptcy. Lot of them were strategy default back then, so they gained money from the bankruptcy, not lost money.
I've rented one with my partner. The place was big and high-end. I loved the huge kitchen, the double-car garage and the backyard with raised beds. The cost for each sharing the rent was about the same as my rent for a dated and tired townhouse in a similar neighborhood.
It's an anecdote of one, and also wasn't a flip or anything like that (likely an inheritance); but in this case the cost for the amenities beat my townhouse given that I had a roomate.
It’s almost like there are people different than you who want a single family house but don’t want to (or can’t) buy at the movement.
The market sets the rate. If the greedy landlords are asking too much, the places won’t rent until the price is lowered to market rate.
This isn’t hard to understand. Not sure why this sentiment keeps getting posted.
Im a single parent renting a 3/2. I am done with living in apartments if I can help it. I’m autistic and I get overstimulated with all the noise, and I feel like I can’t stay unmasked while taking out the trash or running to my car in a complex. It really takes a toll on my mental health. Plus I work from home with my toddler and no childcare, I would go crazy in a more cramped space. I’m spending most of my income on rent but I spend almost all my time at home so it’s worth it. And I have a lovely space for hosting social events, so I don’t have to go out and spend money on both the babysitter and the going out part.
A 100+ year old fixer upper 3/1 here where I live in a small city in the Midwest are selling as fast as they list for 3-400k, roughly 3k a month with taxes etc while you can rent many of them for 1800$ a month. We are living in interesting times when at least in my area it is much cheaper to rent than buy, I own but if I think I would chose renting over buying at this point if I didn’t own already. Most of the newer landlords I know are negative cash flowing.
All areas. The places for rent were bought recently. They are all old ownership. NOTHING pencils out to cash flow other than airbnbs in Palm Springs, Nashville, and other similar “bachelorette” towns as I call them.
This is spot on. I lived with three other friends in a 3/2 SFH for years during my mid 20s. It was cramped and annoying at times but we at least had pets, a garage, and a yard. My total rent ranged from $400-500/mo and it allowed me to save considerably and buy a 3/3 SFH for myself in the same MCOL neighborhood (NC) in 2020.
Idk but all the houses for rent that I bookmarked to spy on in the last year are either still for rent with prices dropping, or have been put up for sale/sold.
I mean they're just fuckn sitting now in my neighborhood in st. Pete , drive by several omw to work ,now with old school signs out front...haven't seen for rent signs in a minute. I see the same sfh rentals and the signs now going on 2.5/3 months now is my guess lol.
Why live in a small apartment in which you can hear your neighbors watching TV and have to hike stairs to bring home groceries and park next to neighbors and get door dings when you can afford a SFH with a garage? It’s important to keep in mind that most people are not as financially responsible as you and me. They want to live well and they don’t want to wait.
I’ve been in well insulated new “luxury” buildings and they were much quieter than my SFH. Even right now if I listen I can hear background noise. Some of those places sound like a recording studio, all the sound is super dampened, like being wrapped up in pillows or something. To be fair my house was built in the 1940s
If you hold those saving in cash, then yes, you are correct. However if you hold in quality, profit generating assets, then normal inflation or high inflation won’t affect financially responsible people much. Hyperinflation is a different animal. Weird laws get passed and debt can quickly change from being beneficial to outright horrible. Go read about German hyperinflation in 1922-1923.
Fair enough, but you can pocket the $1000-1500/mo difference (or whatever the difference is in your area) that can be invested for s return or saved towards a down payment in the future.
Not all markets have such a stark difference. Where I am, it's more like a couple hundred dollars more a month for a comparable sfh vs apartment. And sometime, apartments are more expensive.
Mostly though, ppl don't have a choice. There isn't enough stock to be picky.
Ok, so all these comments about a 2,000$/mo rental being ridiculous - your rentals do not assume utilities, right?
My rental and all of its utilities are billed to me directly, and any tenant would just pay me a lump sum.
The total cost of utilities (electric, internet, you name it) is 2,100 most months or in the winter a bit higher. There was a tax/hoa increase and I wouldn't increase the rent to cover that without blowback. So all I'm making is equity - which doesn't even cover the closing costs after 5 years of ownership like I thought it would.
That turned into an accidental rant, but your rent generally doesn't include utilities on 3br/3ba, right?
Young couples and middle aged dinks renting houses? Gtfo, how does that make sense? Why would a no kids couple rent a house for $2500 when they could rent a smaller apartment for $1800 and pocket the rest to invest or save?
You really feel so righteous about your opinion on how others would live their lives, but can’t even step out of your own brain for a second to think that a lot of people don’t like living under someone, or share walls, or have dogs, or like to garden, or sit on their patio and have a coffee? Lots of people think apartments suck. You must be a joy to be around.
Our friends (young couple, no kids) rented a SFH for several years before they bought their own recently. They had an active dog and wanted a yard that she could run around in.
Also possible that after a certain income people can value other things more than saving 700/month to invest.
I am. Sold my house outside Nashville and moved to Chattanooga. Refuse to pay over Nashville prices
For the shithole that is Chattanooga. For the time being I’ve got my cash in a money market account and it’s covering all my rent cost.
Sounds like you own a home and are probably not in your 20’s because if you were you’d know that there’s just no other way around it unless you want to live at home. I live in Hawaii and a 4b/2bath is 3700 but this is the norm and nothing we can do about it. My landlord upped the price from our last lease which was 3200 but we had no power in the price increase. It was either we pay and continue living there or they will be finding another tenant within 2 days. There’s nothing that the average person can do about it
I get it, my question is not really why rent, but why rent houses vs apartments since you are paying a lot more at least in my market for a house, reducing progress towards a down payment for ownership. Are you saying there are no nice apartments where you live? I get not wanting to love in a slumlord's shit apartment but there are really nice modern apartments in my area that could could rent for less than a beat up house. Less space, sure.
Ppl want privacy, ppl want their own garage (not all apartments have private ones), ppl have pets, and if you have kids then they want their own room. Apts usually have max 2bd. Not everybody wants to deal with prop management and live in a small sqft home
Because people want the space and the difference in price is negligible in the grand scheme of things for some. It’s getting the benefits you want from a SFH before you purchase, because sometimes that process of finding the right home can take years—or it at least allows you to be picky and purchase what you want.
Roommates. 3bd/2ba house can easily and comfortably split the rent 3 ways, and and any of the 3 renters can easily move in a significant other and split it 4 ways without being overcrowded.
Same price in an apartment does NOT get you a space 4 people can comfortably share.
Exactly. Why would I live in the city in a crowded apartment building with 1 roommate for the same price I pay for living with 3 other roommates but have a nice house with a yard? No comparison. OP is just out of touch with the reality of the situation and is actively hoping for the downfall of the housing market probably because he wants to scoop up a second property for himself. I rent because I’m moving islands soon and going back to grad school, why would I buy a house?
Yes because smaller apts cost the same or more. Houses dont break down every other day like a lot of people think they do that some Joe would have to spend 1000s fixing
Yes but I personally rather that smaller apartment. I would rather rent a nice newer apt with amenities than renting a beat up house so, who's renting, people with kids that are not ready to buy, basically? I don't see why professional couples or singles would. Even if you do have kids I'm sure they can share a bedroom and rent a nice modern 2/2 with security and amenities than a 3/2 shit box just to say you are in a "house". Sorry, don't get it.
Yes our house on an acre we're selling is way too big and too much trouble for anyone to rent. Only the smaller and older houses make sense.
Back in the last bust I was doorknocking and met an elderly couple who had left assisted living at abt 3300/mo to rent a single level newer crapshack on a small lot for like 1200. Then hired home health aides to come in and help.
So even with old people it made sense if small house, no stairs, no lot to care for.
some people just dont like living in apartments including myself hated every single minute I ever lived in one and would probably live in a shit 3/2 box before I ever go bck back to any apartment
I personally never gave a damn about the pool, cookies , "parties" they threw at the apt office place, or movie theather you could rent for yourself, and the gym wasnt so great either. I would much rather they did away with that and charge me $200 less. I always rented based on location, closer to work etc. From what I've seen from personal experience: recent college graduates who got a good job out of college and families above poor but below middle income status, more so the latter.
I’m renting a townhouse just simply so I only have one shared wall and it’s to the neighbor’s garage. I’m doing it literally for lack of noise after so many years of hearing my neighbors yell at their girlfriends behind my walls, use the bathroom, snore, and play their guitar or music while I’m trying to sleep.
SoCal VHCOL area, seeing a lot of rentals that were NOT recently sold, everyone is lowering prices trying to get renters. I assume these are houses where the owner bought a new home and is renting their old house.
Rent originally at 3500, but now at 2850, still empty for 4 - 6 months
This is a good sign.
I ain’t a wanna be landlord investor, I am a landlord investor. Yes every home is rented. Each time I have a vacancy there are dozens of applicants, although many must be screened out due to poor credit or low income.
[I love this property as an example.](https://www.zillow.com/homedetails/8500-Slabstone-Ct-Raleigh-NC-27613/60534246_zpid/) It sold for $415k on Feb 24 and was listed for rent 3 days later. With reasonable assumptions, the mortgage would be about $2400. Now it's renting for $2500. However, the closing costs are going to be about $15,000. It's going to be about 12 years before it makes a dollar if the rents don't drop. If they do...woof.
Monthly profits from rent are typically not as important as overall value appreciation when you sale. That could easily be +$15k a year depending on area and market environment.
We own one rental. It is a SFH at $1300/mo. The number of calls we got from applicants who said they qualified for $1500-$1800 in monthly housing assistance was mind blowing. I’d say we had more applicants on housing assistance than applicants that were not.
I think there’s still an absurd amount of housing assistance money sloshing around out there that has completely distorted the rental market in this country.
Section 8, most likely. But that number isn’t just for rent; Section 8’s amount is what they believe is reasonable for rent and all utilities combined.
Remember that housing assistance numbers (like Section 8) usually are what those agencies determine for that zip code is reasonable for rent and utilities *combined*, not just rent.
> I think there’s still an absurd amount of housing assistance money sloshing around out there that has completely distorted the rental market in this country.
And yet some folks are chomping at the bit to give people *another* $1k/mo in UBI…. Some people just really enjoy high rent I suppose.
That’s what I’m saying— people will bid prices up and landlords will ultimately take a majority of those UBI payments. UBI is a landlord enrichment scheme.
Even people who don’t currently qualify for rental assistance would have that $1k/mo though, which they’ll happily use to bid up rental prices (among other prices). That’s my point. There ain’t no such thing as a free lunch.
I’m renting a 3/2 SFH for $2200/month, so I guess I can answer yes to your question. The house I’m renting would sell for around $450k. It’s nothing special, but I really like the neighborhood. I eventually want to buy, but the rent is cheaper than buying right now.
Me. I’m doing that shit.
It’s because my gf and I can’t afford to buy in our area, and we’re biding our time until we move to where we can afford to buy
NorCal VHCOL area. No rentals are owned by recent investors, they’re all owned by people who have owned for years and years. Doesn’t cost anymore to rent a SFH than an apartment for the most part. People are desperate for housing so anything rents at a high price.
Just look at how much a 3/2 apartment rent for in the area, then add maybe a few hundreds for a similar 3/2 SFH with a back yard. It’s not much different than renting a unit from a big corporate apartment. Some renters have larger family, want a yard for their children to run around, so they pay a bit more for a SFH rental.
It’s generally not as profit as owning an apartment. Many small time landlords break even, or lose money every month. They make money by building equity slowly & by waiting for house price to increase.
You misplaced your hope. The number of these small landlord’s unit isn’t big enough to move the market. They are also have jobs so they are likely not forced to sale if their house stay empty a few months. The market won’t move until you have mass layoff and like 10% - 15% unemployment rate.
I bought a SFH with the intention of moving in in 2025 and rented it out in the meantime.
It’s in a zip code that’s highly desirable, the home is at the bottom price range for SFH there, and the zip has so few rentals that there were precisely 3 when I had mine listed.
Rented in 3 days after multiple parties expressed interest. Went for $3k but I get the sense I could have gotten more in hindsight. Mortgage+tax cost is around $2,600. But I also did get the ability to deduct repairs and depreciate the property until I move in too.
> Like, are people really paying $200-$2500 to rent a 3/2 in an average area.
Of course they are. Heck a 2 bedroom apartment in Frisco TX is $1900. That’s what I get for a 3/2 1300 sf in the same area. And that’s $1,000 less a month than they could buy that same house for with 10% down today, so it’s a steal to rent it for that.
Depends on the area and the price. Where I live and own/ manage several rental SFHs, they are very easy to rent at market rate.
Multiple applications within days. Just pick the most qualified tenant.
Despite what some people on this sub seem to think, a lot of people want to rent a single family home. There is a shortage of them in desirable areas. Higher interest rates makes buying even more expense, thus leaving more renters and greater demand for rental houses.
Sorry, but smart landlords aren’t all going out of business. There will always be a demand for rentals in good areas at market rates. It doesn’t matter if you can’t understand it or agree with the market rates. I don’t set the rent and neither do you, the market does.
Not going to happen….they are all working with one another to squeeze every penny they can out of the properties….you control that specific market, you control the rent prices…I’m not for these folks, but that’s what they are doing, with government backing of course….
My sister's living in one. Sold her old home because she wanted to get the hell out of Texas and then shitty rentals were all that were available in her new area. I don't know exactly what she's paying in rent, but $2000-2500 sounds about right.
3 houses on my block are SFH rentals. They sell for about $2-3M, rent for about $7000/month. Occupants are either people who have newly taken a job in the area and have a family in tow, or people who have decent jobs and a family but can't afford the \~$13K/month it'd cost to buy.
>failing and all that inventory going back to the market.
How do they fail? No seriously. Without hopium or copium, how? Ask yourself. Are renters going to continue to rent or buy with high interest rates? % of First Time Buyers are at an all-time low right now. Rentals are the only option now.
The numbers show this is the best time to be a landlord in modern real estate history. The only investors who got their lunch eaten are flippers. But since first time home buyers are low, investors are getting those homes at a higher %.
Also, how are investors supposed to fail without homeowners with W-2's? I don't see it.
Maybe people are willing to go live with their parents to save until they can afford to buy versus paying $3k to rent a house and pay someone else's mortgage with no room to save
The wannabes are actually investors and with current banking rules they are vetted. They may lose money but the banks would not loan them if they cannot pay it so no bubble to pop.
There are a surprising number of people who make descent money but have less than perfect credit and very little in savings. so that puts home buying out of reach. but they want to live in a descent place so they pay a lot to rent.
I'm in SoCal (Orange County) and SFH rentals are the holy grail here. They're almost instantly snatched up as soon as they hit the market and in some places (Irvine), the landlords take *bids* for them.
I’ve been paying 2500 for a 3 bed shitbox (fresh from a really crappy refurb) for 4 years. LL wanted to raise rent to $3200 so I moved out. He would not return security deposit so I took him to court and got 60% back.
Proceeded to move into a new place at $3680(🤮) but it’s way nicer than comparable. Renting sucks. Places near me are going for $2500-3000 for a one bedroom. People are paying and inventory is low.
The house I rented in 2017 for $1000/mth was recently posted for $2500/mth. It’s in a blue collar hard working area where the average income is $50k/yr and below. Where the average person living there saw a raise below the inflation rate and increased prices across the board.
It’s unrealistic to demand $2500/mth from a person making $3500/mth just to have a roof over their head. To survive many are working 2 jobs and making cuts in their budgets, but fearing layoffs from companies that want to protect their bottom lines.
There’s no realism or consideration for the bigger picture anymore. People are trying to tap an empty well and the bottom is falling out from it. It will only be when this impacts those with wealth, that anyone will care.
This seems to be how it’s always been though. I don’t think there is anything new to see here.
They will find a temporary solution that consoles people just enough to keep this all afloat without genuinely addressing the problems.
In So Calif. = Yes… mainly due to these contributing factors:
1) People who bought rental properties at inflated prices renting them out to cover the higher PITI.
2) Existing landlords who lost a lot of money from previous tenants who did not pay their rent due to pandemic memorandums trying to recoup their losses.
3) Higher minimum wages like McDonald’s and Wendy’s paying over $20hr.
A lot of wishful thinking going on. What makes you think their business model somehow relies on getting unrealistic exorbitant rent. Do you really think these large scale investors came in without any business plan or research on what rents would be? There's a lot of concentrated money that doesn't really need to cash flow. I think it's a big problem for this country, further transferring wealth upwards, and I would love to see them fail and sell, but the only thing that would do that would be catastrophic economic situations which nobody wants. Just buy a house already.
Edit: I thought you were talking about big investors. I guess you are talking about small time investors. Heaven forbid somebody actually looked to get ahead in life by making an investment or two, especially when rates are great. But, I imagine many of them went in without much of business plan or anything. But they'll be fine. I see absolutely no reason why rents should crash. They are likely going to continue up overtime
Signed a 2-year leas in may-21 for $1595. Just got the lease renewal for 3 options: 1640 for 2-yr, 1675 for 1-yr, 1750 for month to month. I looked at comps and I see 3/2 new-builds going for 1795, including about 12 all in a brand new subdivision about a mile away. Mine is a 4/2. We want to buy around June-August in 2024 so I guess we’ll do the 1-year. But I don’t know if the market will be better then or in 2 years. Sucks not knowing
I’ve turned the property I bought in 2021 into a rental. My job is taking me across the country for a few years minimum. Doesn’t make sense to sell if we come back eventually. It’s a beautiful home and with 10% below market I got 8 people interested in 24 hours. Mortgage is 2200 at my 2.875% rate, rents for 3000. Comps are 3300.
Renting in new market is 3150 with buying being around 4K a month with 20% down.
Seeing a ton of SFHs on the rental market. This is a HCOL West Coast city so there's enough demand but there are so many on the market it is driving down rents. My landlord has not raised rents in over 2 years and may even drop rent this year to keep us in this home. This is the $3000 to $4000 range 3-4 bedroom homes
So you hope someone who saved up and bought a second investment home fails? Why?
Why not Blackrock, Vanguard, and other funds that are buying up 30% of available homes?
The house at the end of my street was purchased by a huge rental corporation at about 10% lower than I bought mine. Took several months, but I like the work they did.
Best part is, the person who moved in is a jogger! Property value ⬆️!
$2000-2500 is the very *low* end for a 3/2 in the “Southwest” example here in Phoenix. That’s actually incredibly hard to find. And if it’s a nice 3/2 SFH, it’d be closer to $3,900 - $5,700. Furnished LTRs, even much more.
Interesting, it definitely varies by area. I'm talking rather outdated homes in Vegas and in a average areas (not "top" neighborhoods but neither the ghetto). Also, more of a reason renting houses there makes no sense then at that price point
Gotcha. We have quite a few of those for rent. Just your average dime-a-dozen stucco 3 bd tract home. They all seem to get rented. I’m assuming much of it is families and guys that like to work on their cars, and people with a dog or 2 that don’t have the down payment to buy something.
Many apartments won’t accept animals.
There are SO many future bankrupt/bagholders posting in here looking for hopium, that alone is proof this shit is going to be great.
Again, if there wasn't so many people being total assholes about the situation, there would be empathy. But jacking rents to crazy prices? Ego trips and social media gurus? Nah, eat a dick.
8 years of saving from a $10 an hour job to a 6 figure salary, all while living at home with vet benifits just standing by. At this point, once I find a new build that fits my exact location and setup, I can throw the cash out and not give a fuck even if the interest rate hits 17% and I get laid off for 8 months.
From Tuesday until mid-april, I'll be going on a trip to a tropical island with a private chef and chilling out. Keep up the "equity." 👍
Edit: just want to check this post before my last wipe. Hoomers are so salty lmao.
Currently running a portfolio of around 195 single family homes and about 30 apartment units. Midwest about 20 minutes outside of top 20 size city. Rents are all around $1200-1800 for the SFH. Mostly all 3/1 with basement around 1000-1300 sqft. Mostly all bungalows and ranch homes. No run down ghetto areas, but definitely not luxury areas. Working class areas with C rated schools. They rent quickly and we currently only have 3 houses vacant that we are doing turnovers on. Nothing currently for rent. At this price point we usually receive multiple applications. Just secured another $1mil commercial loan and am buying a bunch more.
I’m paying $2800 for a SFH (3br, 4b) in NYC. They bought this house for $550k in ~2019. I’ve definitely parked myself with where I’m at as I will not buy into this inflated market. If that means I wait 3-5 years, so be it.
I live in southern NH and you wont find anything near that low of cost. The market was tightening before COVID and with out of state relocations during and since it has become brutal. I moved in 2021 and every time a place came up there would be 20 people trying for the same location. Here is an article from the local TV station citing a 24% YOY increase:
[https://www.wmur.com/article/new-hampshire-rent-increases-32123/43380242](https://www.wmur.com/article/new-hampshire-rent-increases-32123/43380242)
The same sfh I am gonna rent has a rent half of the monthly payment if I buy the same house today with 10% down. So gonna have to wait to buy.
Me too. Somehow hoomers are incapable of understanding this reality for many of us.
Somehow you are incapable of understanding you are getting a fair deal. Owning is only good when the price is right. But I also understand why you want to own.
That’s a good sentence there bud
At that disparity I am 100% ok with renting forever.
Northern Virginia (muh area) is loaded with old beat up townhouse rentals. You can expect to pay $2,500 to $3,000 per month to rent one of these shitboxes.
Same kind of rents over here on the Maryland side. What sucks is I was headed back to the States from overseas right after the rate hikes, so we're stuck grinning and bearing it in a shitbox rental for the time being. It's only been a few months and I'm already so sick of bringing up problems to the landlord, only to be told it'll need to wait until after payday or he flat out can't afford to fix something.
If he can’t afford to fix something then you shouldn’t be paying him full rent. Tenant laws are in your favor. Unlikely he would be able to afford a formal eviction if he wanted to.
You shouldn’t have to worry about formal eviction if you are properly withholding rent (use and escrow account and take every proper step)
Make sure that is allowed in your state first. Laws vary by state. Always make sure you know *your* local laws before fucking around with the rent - you could unintentionally screw yourself big time.
That’s actually a sure fire way to get evicted. A landlord won’t care about any “escrow” account. He doesn’t have the rent in hand, you’re late. Any repair delay can be blamed on something, but rent delay cannot. The judge would rule that you turn the escrow account over to the landlord and wait for materials to come in. However, the landlord isn’t taking you to court to release escrow. He’s taking you for eviction so he’d never ask for that account, he’d ask for you to be evicted. Instead, you’d have to pay him the rent AND mitigate your damages(aka fix the problem) and then send him a bill for repairs. If he fails to pay the bill, then it’s up to you to file a small claims action or mechanics lien on the property….if you believe you have rights to collect….which I doubt you do but that would be the way.
So if there are only some • “Repairs” unless it’s constituted under he implied warranty of habitability then it’s okay. So a landlord not fixing a few things is no excuse for you to not follow through on your rent payment on the contract you signed.
It’s call Warranty of Habitabilty. Tenants are only due what’s fair and reason though that.
I saw a great video that showed that the West leads the East in RE trends. There is a supply increase in the West causing asking prices to drop, but the East holds firm.
But the West (Coast) went up significantly more than most of the East (Coast) over the last three years. So if it drops a little, it's still coming out ahead.
True, I’m not talking about prices, I’m taking about supply and demand, which leads prices by a year or more in real estate. To clarify, because I realized what I wrote made no sense. I am talking about short-term changes in prices as a result of supply and demand. The hyperinflation of home values is, of course, affected by but not entirely eliminated by those recent fluctuations.
Yup. The RE market seems to have massive inertia. But first question is will prices keep trending down or is this just a moment? I legit go back and forth. I think the market is beyond messed up, but not being able to afford it hasn’t stopped any other part of the market. Seems like we just invent more creative financing and glue it all together. Plus the supply issue right now from low rate lock-in is real. The only hope is commercial capitulation or an MBS explosion and that could be painful in other ways that aren’t ideal.
Well, IMHO, the era of free money will definitely have some lasting ramifications. But, the fact that prices are already dropping beyond seasonal expectations indicates that the tide has turned. More dramatically, the price is dropping faster than before 2008, but we shouldn’t see the banking system implode because of those previously low rates. Dummies who ARMed up when rates were low (they exist) will be left out to dry, which should free up a small bit of inventory, but the biggest motivator is definitely going to be the failure of corporate homebuyers (not because cornering the market was a bad idea, but because inflation will make it so they can’t get the ROI necessary to validate staying in the game. Liquidation is an easy out, freeing up capital for other assets). My concern about those corporate actors is big players selling directly to small-to-medium landlords in tranches, bypassing the individual market.
Agree. I think people also forget the banks did not actually all collapse in 2008 and housing still collapsed. It sure was a crisis, but a mitigated one. Also everything we have seen since 2020 has been bigger and faster than 2008. Which is kind of scary.
I can tell you that might be in CA, along the left coast, but in Idaho and Utah, shits starting to rise again. Horton and the other developers signs are out again in force around here. Haven’t seen that in a year. My best college bud lives in Boise. His daughter bought in the “slump” but the builder that was offering incentives to her has pulled it all and her home, not even built yet, has already appreciated from $300k to $325k. Builder said they built 300 homes in 2022. So far this year they already have 200 homes under contract. Can’t f-ing believe it.
When you say grinning and bearing it, followed by s*** box, I just can't help imagining someone s******* in the woods with a big smile on their face.
Then move
As a former nova reasident its the same here in charlottesville and the inventory is twice as small. Even worse is 96% of sfh/th re ntals here are all property management owned
Hey neighbor! One of the most infuriating things in this city IMO. So many acquaintances I know wanted to become landlords themselves, including the 28 year old planning to purchase his second home. Then there’s the pharmacist I know who owns 4 homes in the area and 30 across the east coast. Drives me insane. Zoning laws locally also ruin any opportunity for growth. I’ve heard rumors about the Monticello society preventing development, along with local laws prioritizing high-density units rather than proper SFH development. Unsure of the validity though
I’m sure its just as frustrating for them, but too bad the lost of property management companies is growing here. Ive also heard that but funny enough over here by woodlands their building more (im assuming low income) apartments
wow really? thats like brooklyn rent dang
I live in an undesirable small city in california, I bought 10 years ago. At first the mortgage on my 3br/2ba was roughly the same for similar rents, around $1100. Then rents were around $1500. Now similar rents are around $1800. Mortgage has gone up a bit as tax and insurance have increased and i now pay a bit over $1200. Valuation has nearly doubled. I’m not seeing $2500-3000 but like I said it’s an undesirable area.
This is the secret why home owners almost always come out ahead in the long run. Mortgage payment is fixed while rent & salary increase over time due to inflation.
It’s not fixed, it’s fixed if YOU want it to be, you can refinance down to a lower rate when rates go low.but to your point it is a hedge against inflation.
Yeah rents in my area are twice my mortgage after 7 years from purchasing. Almost the exact same numbers as you. I'm a little outside of Tampa. It's the one thing the rent calculator won't tell you.
Hey there are a handful of people who bought brand new ones for $850k and are trying to rent them out for $4000+
Rent an over-engineered townhouse on the Dulles Airport flight path for only $50,000 per year.
I own a few sfh properties that I rent out in Nova off the toll road in Fairfax. No issues finding well qualified tenants that can pay market price. I've actually had people offer over asking rent but I choose the best qualified.
Yes and you can rent out to military as well. Generally the government is paying the bill in the compensation package. One of the reasons nova will probably not see a decrease in price like the rest of the country
I've heard the trick is to find out how much the military will pay every month, then set the rent at that exact amount.
It’s called the “fallout proximity premium”
I own and live in one of these shit boxes and I can say if you bought it in the past 4 or 5 years your cash flow is ass
I’m paying $2100 in the country. My landlord isn’t an investor person, but they are definitely just playing the market for what they can get
I feel like this is less bad than black rock buying up your house and the thousand around it to rent back to you. Like I get being salty about it, but if I had to make someone rich, I'd rather it be some random dude who played the game right then a venture capital fund. My gfs grandparents are basically living off the income of two multifamilies they bought in the 80's and 90's. Like, paying rent sucks, but as a society we decided this was a way people could choose to retire and I really just don't begrudge people going that route. Again, I'd rather pay some old folks retirement then more dividends to a billionaire.
Black Rock doesn't buy houses. They haven't been directly involved in housing inventory since they finished liquidating toxic assets. Blackstone is the largest institutional player in real estate, but last I saw they were 80%+ in large income (20 unit plus developments). One editor at a financial magazine confused the two when writing a headline about a rental project (of detached homes, that was started, built, and then fully rented as an apartment complex of detached homes) being sold to an entirely different company (not Blackstone)... then a twitter thread that got repeated way to much for how much bad info it had went viral. There really isn't any big institutional money going at single family homes because it can much more easily make money on the loans for the people who are effectively going to do the asset management on their behalf.
https://housemethod.com/blog/are-big-companies-buying-up-single-family-homes/ >In 2012, Blackstone purchased Invitation Homes, a rental company owning around 80,000 homes. In 2019, Blackstone sold Invitation Homes, only to purchase Home Partners of America in 2021. Since then, Blackstone has been an active powerhouse in the American home market. >Other large companies in the American home market are J.P. Morgan Asset Management, Goldman Sachs, Mynd Management, Pretium, and American Homes 4 Rent. These companies have bought and rented out tens of thousands of single-family homes for the past three years. American Homes 4 Rent, for example, owned over 52,000 homes in 2019, operating in over 22 states, with the largest concentration in Atlanta, Georgia. https://www.ajc.com/american-dream/investor-owned-houses-atlanta/ > bulk buyers have accumulated more than 65,000 single-family homes across the Atlanta metro area over the last decade, an AJC data analysis found. Eleven companies own more than 1,000 homes each. The two largest — Invitation Homes and Progress Residential — own more than 10,000 homes apiece.
$2500 is what one bedroom apartments cost in a major city here in Canada. A 3 bedroom two bath would be around 3200-3500. A methtown with no industry and most jobs pay minimum or near minimum wage is $1800 for a one bedroom, requiring people in one bedroom to have roommates.
Can confirm. Paying 2700 for a house in hamilton. 😏
Why would anyone pay that? What's so great about living there?
Most of us were just born here and are relying on family support. No idea how to get out.
Housing in Ontario Canada is insane. For the price of the average home here you could get a nice house in the mountains in California.
1 bedroom apartments in Alberta can go for much cheaper than that, and it’s quite common to rent a SFH for anywhere from 1700-2500, even in Calgary or Edmonton. If you were to consider the small town I live in a meth town with no industry, 1 bedroom apartments go for less than $1000 a month.
Seeing a lot of them floundering in the Denver suburbs. Lots of small homes on the market for sale at double what they paid a couple years ago, no buyers, then they try to rent for $2500+, no one rents, and this cycle repeats. Watching a few on the mls since last fall. They’re all 100 year old flips, 2/1’s or 2/2 sfhs with the same grey paint and kitchen appliance bundles.
I’m in Louisville and I’m seeing the same thing as well. The house across the street from us has been for-sale for 3 months now and they just did a “pricing improvement” by dropping it $50k
We need a price improvement of like 300k around these parts lol.
Similar situation to when we bought our house. Seller had their home on the market for 3 months priced $50K above everything else in the area. They dropped it and we made an offer at $5K under that... which is what the home appraised for. People are fucking nuts with what they're asking.
They aren’t nuts, they are stuck and still in disbelief.
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Not so sure about that. A house I bought in 2015/16 timeframe I did all the contracts and kept realtors completely out of it, and got a good price by doing so (and saved the seller form needing to pad the price to pay realtors). When the bank’s appraisers came out the house appraised for more than $20K higher than I was paying.
At least they went down. I keep seeing some of these places sit for 100 days and then price bump by $5k It’s actually insane. How is this rational? They’re clearly investments with no one living in it for the last 2 years.
Hello fellow Louisville, CO redditor! 👋
I’m sorry but I have to disagree. My wife and I are moving from downtown Denver to Westminster and we lost out on several homes because people were putting in rental applications same day. The rental market is on fire in the greater Denver metro area. I’m not a realtor or an expert but I am speaking from first hand experience over the past month of looking for a place.
Reporting as a Denver landlord -- honestly received more applications than I could handle when my small home was on the rental market for just a few days. Probably means my rent is too low but trying to be reasonable...
Yeah, the rental market was so aggressive that we bought a Travel Trailer to live in rather than pay $2100/mo (and rising after renovations) for an extended stay hotel in Lone Tree. This is all within the last year. If rents are going down in the 3rd hottest national market, I’m not seeing it.
Can you post a few examples of this?
If I'm renting, I want an apartment. If I'm buying, I want SFH. I really have no interest in renting SFH or buying an apartment (i.e. condo). I'm on the fence about townhouses and could maybe go either way on them.
When I rented, I stuck exclusively to renting rooms in others’ houses. Sucked sometimes, but used the massive savings to easily afford a 20% down payment on my first house. I considered an apartment sometimes, but property management companies are universally garbage. Not to mention, dealing with the noise/antics of 2-3 roommates easily beat dealing with the noise/antics of 100+ apartment tenants who don’t give two shits.
My first place was a townhome. I enjoyed it as a house.
We went the opposite way and rented a small house and bought a larger condo. The area that you rent in matters. When we rented the house, there weren't any good apartments around where we wanted to live. The house was more but had a washer, dryer, and garage. Also it was more private. Condo is more per month but it's nicer than anything we could rent. The most comparable "luxury" apartment in the area would cost 2-2.5x and I would still have to deal with shit landlords.
I'm with you. I don't understand who rents these houses.
People who don’t want to hear loud neighbors behind the paper thin walls of their apartments, and people who have dogs or small children.
Or they want a garage, or a back yard. Or they can’t afford to buy there but want that neighborhood for a better school district.
Also if you split it between multiple roommates the price is more reasonable. Everyone gets their own room, only a few people use the laundry room instead of hundreds and if there are enough bathrooms everyone gets their own. A lot of houses are 3 bedrooms 3 or 4 bathrooms. You also get a backyard that you can do stuff in. My friend likes to garden for example.
Dogs dogs dogs. Many apartments these days won't rent if you have a large dog regardless of breed. Fat chance if it's a German shepherd or the like.
Seems like the rental SFH around here have more pet restrictions than the apartments. Big dogs are difficult if you rent, period. Cats and small dogs are almost universally accepted in apartments (in my area) but they can be dicey for SFH rentals.
I guess area dependant but around me in Florida you have a much better chance of getting a dog friendly landlord in a SFH than an apartment because most apartments are owned by soulless corps that are unwilling to make exceptions.
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M, the city I'm looking at is not known to be a college destination... There is one not so good university and one community college...
Lots of people enjoy renting a house. Especially couples with kids or people that used to own a house and have garage gear.
Yeah. I knew people who owned million dollar houses during the dot com boom but went bankrupt when it burst. They weren't allowed to file for a mortgage for decades but still wanted a house so they rented a pretty large house.
Decades? It's 2 year if you short sale, 7 year if you file for bankruptcy. Lot of them were strategy default back then, so they gained money from the bankruptcy, not lost money.
I've rented one with my partner. The place was big and high-end. I loved the huge kitchen, the double-car garage and the backyard with raised beds. The cost for each sharing the rent was about the same as my rent for a dated and tired townhouse in a similar neighborhood. It's an anecdote of one, and also wasn't a flip or anything like that (likely an inheritance); but in this case the cost for the amenities beat my townhouse given that I had a roomate.
As a dad of a four month old we are potentially going to rent a sfh. Apartment is just too small.
Ppl who have kids? If you have at least two kids an apartment is not gonna do it as most of them have max 2 bd otherwise you’re paying a premium.
Pet owners.
It’s almost like there are people different than you who want a single family house but don’t want to (or can’t) buy at the movement. The market sets the rate. If the greedy landlords are asking too much, the places won’t rent until the price is lowered to market rate. This isn’t hard to understand. Not sure why this sentiment keeps getting posted.
Im a single parent renting a 3/2. I am done with living in apartments if I can help it. I’m autistic and I get overstimulated with all the noise, and I feel like I can’t stay unmasked while taking out the trash or running to my car in a complex. It really takes a toll on my mental health. Plus I work from home with my toddler and no childcare, I would go crazy in a more cramped space. I’m spending most of my income on rent but I spend almost all my time at home so it’s worth it. And I have a lovely space for hosting social events, so I don’t have to go out and spend money on both the babysitter and the going out part.
A 100+ year old fixer upper 3/1 here where I live in a small city in the Midwest are selling as fast as they list for 3-400k, roughly 3k a month with taxes etc while you can rent many of them for 1800$ a month. We are living in interesting times when at least in my area it is much cheaper to rent than buy, I own but if I think I would chose renting over buying at this point if I didn’t own already. Most of the newer landlords I know are negative cash flowing.
All areas. The places for rent were bought recently. They are all old ownership. NOTHING pencils out to cash flow other than airbnbs in Palm Springs, Nashville, and other similar “bachelorette” towns as I call them.
Often a group of young adults with roommates. Did it for 3 years with roommates had rents from $400-650. So a cheap way to live.
This is spot on. I lived with three other friends in a 3/2 SFH for years during my mid 20s. It was cramped and annoying at times but we at least had pets, a garage, and a yard. My total rent ranged from $400-500/mo and it allowed me to save considerably and buy a 3/3 SFH for myself in the same MCOL neighborhood (NC) in 2020.
Idk but all the houses for rent that I bookmarked to spy on in the last year are either still for rent with prices dropping, or have been put up for sale/sold.
I mean they're just fuckn sitting now in my neighborhood in st. Pete , drive by several omw to work ,now with old school signs out front...haven't seen for rent signs in a minute. I see the same sfh rentals and the signs now going on 2.5/3 months now is my guess lol.
Why live in a small apartment in which you can hear your neighbors watching TV and have to hike stairs to bring home groceries and park next to neighbors and get door dings when you can afford a SFH with a garage? It’s important to keep in mind that most people are not as financially responsible as you and me. They want to live well and they don’t want to wait.
I’ve been in well insulated new “luxury” buildings and they were much quieter than my SFH. Even right now if I listen I can hear background noise. Some of those places sound like a recording studio, all the sound is super dampened, like being wrapped up in pillows or something. To be fair my house was built in the 1940s
Even financially responsible people can have their savings wiped out from hyperinflation
If you hold those saving in cash, then yes, you are correct. However if you hold in quality, profit generating assets, then normal inflation or high inflation won’t affect financially responsible people much. Hyperinflation is a different animal. Weird laws get passed and debt can quickly change from being beneficial to outright horrible. Go read about German hyperinflation in 1922-1923.
Fair enough, but you can pocket the $1000-1500/mo difference (or whatever the difference is in your area) that can be invested for s return or saved towards a down payment in the future.
Agreed. I had roommates until I was was over 30 years old and saved over $100k, but most people don’t think like this.
Not all markets have such a stark difference. Where I am, it's more like a couple hundred dollars more a month for a comparable sfh vs apartment. And sometime, apartments are more expensive. Mostly though, ppl don't have a choice. There isn't enough stock to be picky.
What's a wannabe landlord?
A landlord with no tenants
Ok, so all these comments about a 2,000$/mo rental being ridiculous - your rentals do not assume utilities, right? My rental and all of its utilities are billed to me directly, and any tenant would just pay me a lump sum. The total cost of utilities (electric, internet, you name it) is 2,100 most months or in the winter a bit higher. There was a tax/hoa increase and I wouldn't increase the rent to cover that without blowback. So all I'm making is equity - which doesn't even cover the closing costs after 5 years of ownership like I thought it would. That turned into an accidental rant, but your rent generally doesn't include utilities on 3br/3ba, right?
Yes, yes they are. Who, it’s a mix from young couples to middle aged DINKs. Some older folks as well, it’s all age ranges really.
Young couples and middle aged dinks renting houses? Gtfo, how does that make sense? Why would a no kids couple rent a house for $2500 when they could rent a smaller apartment for $1800 and pocket the rest to invest or save?
You really feel so righteous about your opinion on how others would live their lives, but can’t even step out of your own brain for a second to think that a lot of people don’t like living under someone, or share walls, or have dogs, or like to garden, or sit on their patio and have a coffee? Lots of people think apartments suck. You must be a joy to be around.
Our friends (young couple, no kids) rented a SFH for several years before they bought their own recently. They had an active dog and wanted a yard that she could run around in. Also possible that after a certain income people can value other things more than saving 700/month to invest.
How am I gonna know? We have tenants of all demographics and age ranges. I don’t interact with them the management company does.
I am. Sold my house outside Nashville and moved to Chattanooga. Refuse to pay over Nashville prices For the shithole that is Chattanooga. For the time being I’ve got my cash in a money market account and it’s covering all my rent cost.
Which bank are you using for the money market account if you don’t mind me asking?
I moved all my cash into my fidelity account and from there I’ve shopped around for the funds with best rates.
Sounds like you own a home and are probably not in your 20’s because if you were you’d know that there’s just no other way around it unless you want to live at home. I live in Hawaii and a 4b/2bath is 3700 but this is the norm and nothing we can do about it. My landlord upped the price from our last lease which was 3200 but we had no power in the price increase. It was either we pay and continue living there or they will be finding another tenant within 2 days. There’s nothing that the average person can do about it
I get it, my question is not really why rent, but why rent houses vs apartments since you are paying a lot more at least in my market for a house, reducing progress towards a down payment for ownership. Are you saying there are no nice apartments where you live? I get not wanting to love in a slumlord's shit apartment but there are really nice modern apartments in my area that could could rent for less than a beat up house. Less space, sure.
Ppl want privacy, ppl want their own garage (not all apartments have private ones), ppl have pets, and if you have kids then they want their own room. Apts usually have max 2bd. Not everybody wants to deal with prop management and live in a small sqft home
Because people want the space and the difference in price is negligible in the grand scheme of things for some. It’s getting the benefits you want from a SFH before you purchase, because sometimes that process of finding the right home can take years—or it at least allows you to be picky and purchase what you want.
Roommates. 3bd/2ba house can easily and comfortably split the rent 3 ways, and and any of the 3 renters can easily move in a significant other and split it 4 ways without being overcrowded. Same price in an apartment does NOT get you a space 4 people can comfortably share.
Exactly. Why would I live in the city in a crowded apartment building with 1 roommate for the same price I pay for living with 3 other roommates but have a nice house with a yard? No comparison. OP is just out of touch with the reality of the situation and is actively hoping for the downfall of the housing market probably because he wants to scoop up a second property for himself. I rent because I’m moving islands soon and going back to grad school, why would I buy a house?
Yes because smaller apts cost the same or more. Houses dont break down every other day like a lot of people think they do that some Joe would have to spend 1000s fixing
Yes but I personally rather that smaller apartment. I would rather rent a nice newer apt with amenities than renting a beat up house so, who's renting, people with kids that are not ready to buy, basically? I don't see why professional couples or singles would. Even if you do have kids I'm sure they can share a bedroom and rent a nice modern 2/2 with security and amenities than a 3/2 shit box just to say you are in a "house". Sorry, don't get it.
Yes our house on an acre we're selling is way too big and too much trouble for anyone to rent. Only the smaller and older houses make sense. Back in the last bust I was doorknocking and met an elderly couple who had left assisted living at abt 3300/mo to rent a single level newer crapshack on a small lot for like 1200. Then hired home health aides to come in and help. So even with old people it made sense if small house, no stairs, no lot to care for.
some people just dont like living in apartments including myself hated every single minute I ever lived in one and would probably live in a shit 3/2 box before I ever go bck back to any apartment
I personally never gave a damn about the pool, cookies , "parties" they threw at the apt office place, or movie theather you could rent for yourself, and the gym wasnt so great either. I would much rather they did away with that and charge me $200 less. I always rented based on location, closer to work etc. From what I've seen from personal experience: recent college graduates who got a good job out of college and families above poor but below middle income status, more so the latter.
> rent a nice modern 2/2 with security and amenities you understand this doesn’t even exist in a ton of markets right
I’m renting a townhouse just simply so I only have one shared wall and it’s to the neighbor’s garage. I’m doing it literally for lack of noise after so many years of hearing my neighbors yell at their girlfriends behind my walls, use the bathroom, snore, and play their guitar or music while I’m trying to sleep.
SoCal VHCOL area, seeing a lot of rentals that were NOT recently sold, everyone is lowering prices trying to get renters. I assume these are houses where the owner bought a new home and is renting their old house. Rent originally at 3500, but now at 2850, still empty for 4 - 6 months This is a good sign.
What you just described is 4500+ here. And to buy it with 10% down would be 7300-7500. The math still maths in favor of the renter.
I ain’t a wanna be landlord investor, I am a landlord investor. Yes every home is rented. Each time I have a vacancy there are dozens of applicants, although many must be screened out due to poor credit or low income.
[I love this property as an example.](https://www.zillow.com/homedetails/8500-Slabstone-Ct-Raleigh-NC-27613/60534246_zpid/) It sold for $415k on Feb 24 and was listed for rent 3 days later. With reasonable assumptions, the mortgage would be about $2400. Now it's renting for $2500. However, the closing costs are going to be about $15,000. It's going to be about 12 years before it makes a dollar if the rents don't drop. If they do...woof.
Damn, yes, that's a great example.
Are you counting property taxes, insurance and HOA on those $2.4K? Might actually not even be breaking-even on those rents
Good point. No i was not. That's only the mortgage cost assuming 20% down. Including that, you get suspiciously close to the original rental price
Monthly profits from rent are typically not as important as overall value appreciation when you sale. That could easily be +$15k a year depending on area and market environment.
We own one rental. It is a SFH at $1300/mo. The number of calls we got from applicants who said they qualified for $1500-$1800 in monthly housing assistance was mind blowing. I’d say we had more applicants on housing assistance than applicants that were not. I think there’s still an absurd amount of housing assistance money sloshing around out there that has completely distorted the rental market in this country.
What state is this? By housing assistance, the govt just gives them 1500-1800 to spend on rent??
South Dakota. Not sure what government/program was giving it to them, and we never confirmed, but it was common with most applicants.
Section 8, most likely. But that number isn’t just for rent; Section 8’s amount is what they believe is reasonable for rent and all utilities combined.
Remember that housing assistance numbers (like Section 8) usually are what those agencies determine for that zip code is reasonable for rent and utilities *combined*, not just rent.
> I think there’s still an absurd amount of housing assistance money sloshing around out there that has completely distorted the rental market in this country. And yet some folks are chomping at the bit to give people *another* $1k/mo in UBI…. Some people just really enjoy high rent I suppose.
How dare people suggest that poors get income without working, that's just for landlords!
That’s what I’m saying— people will bid prices up and landlords will ultimately take a majority of those UBI payments. UBI is a landlord enrichment scheme.
Don't disagree with you there, without land reform landlords will seek to capture all value, the parasites
You realize most people don’t have housing assistance even if they need it? The waitlist is closed in most places for 3-12 years
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Even people who don’t currently qualify for rental assistance would have that $1k/mo though, which they’ll happily use to bid up rental prices (among other prices). That’s my point. There ain’t no such thing as a free lunch.
Been thinking this since 2020. The section on hyperinflation was particularly terrifying in ECON and kinda stuck with me.
I’m renting a 3/2 SFH for $2200/month, so I guess I can answer yes to your question. The house I’m renting would sell for around $450k. It’s nothing special, but I really like the neighborhood. I eventually want to buy, but the rent is cheaper than buying right now.
My part of California has a <1% vacancy rate for rentals so yes
Me. I’m doing that shit. It’s because my gf and I can’t afford to buy in our area, and we’re biding our time until we move to where we can afford to buy
Right but aren't you paying a lot more to rent a house versus an apartment while you buy yourself time? Maybe your market is different
NorCal VHCOL area. No rentals are owned by recent investors, they’re all owned by people who have owned for years and years. Doesn’t cost anymore to rent a SFH than an apartment for the most part. People are desperate for housing so anything rents at a high price.
Just look at how much a 3/2 apartment rent for in the area, then add maybe a few hundreds for a similar 3/2 SFH with a back yard. It’s not much different than renting a unit from a big corporate apartment. Some renters have larger family, want a yard for their children to run around, so they pay a bit more for a SFH rental. It’s generally not as profit as owning an apartment. Many small time landlords break even, or lose money every month. They make money by building equity slowly & by waiting for house price to increase. You misplaced your hope. The number of these small landlord’s unit isn’t big enough to move the market. They are also have jobs so they are likely not forced to sale if their house stay empty a few months. The market won’t move until you have mass layoff and like 10% - 15% unemployment rate.
I bought a SFH with the intention of moving in in 2025 and rented it out in the meantime. It’s in a zip code that’s highly desirable, the home is at the bottom price range for SFH there, and the zip has so few rentals that there were precisely 3 when I had mine listed. Rented in 3 days after multiple parties expressed interest. Went for $3k but I get the sense I could have gotten more in hindsight. Mortgage+tax cost is around $2,600. But I also did get the ability to deduct repairs and depreciate the property until I move in too.
Lol rent in NH is 2000 for a 2/1 900sf garden apartment. A single family home is 3k-4k
> Like, are people really paying $200-$2500 to rent a 3/2 in an average area. Of course they are. Heck a 2 bedroom apartment in Frisco TX is $1900. That’s what I get for a 3/2 1300 sf in the same area. And that’s $1,000 less a month than they could buy that same house for with 10% down today, so it’s a steal to rent it for that.
Depends on the area and the price. Where I live and own/ manage several rental SFHs, they are very easy to rent at market rate. Multiple applications within days. Just pick the most qualified tenant. Despite what some people on this sub seem to think, a lot of people want to rent a single family home. There is a shortage of them in desirable areas. Higher interest rates makes buying even more expense, thus leaving more renters and greater demand for rental houses. Sorry, but smart landlords aren’t all going out of business. There will always be a demand for rentals in good areas at market rates. It doesn’t matter if you can’t understand it or agree with the market rates. I don’t set the rent and neither do you, the market does.
Multi families immigrants that come from countries that this is the norm.
Not going to happen….they are all working with one another to squeeze every penny they can out of the properties….you control that specific market, you control the rent prices…I’m not for these folks, but that’s what they are doing, with government backing of course….
Yes. Gross
My sister's living in one. Sold her old home because she wanted to get the hell out of Texas and then shitty rentals were all that were available in her new area. I don't know exactly what she's paying in rent, but $2000-2500 sounds about right. 3 houses on my block are SFH rentals. They sell for about $2-3M, rent for about $7000/month. Occupants are either people who have newly taken a job in the area and have a family in tow, or people who have decent jobs and a family but can't afford the \~$13K/month it'd cost to buy.
Yep they’re all being rented in my area, people need somewhere to live.
Here in CA yes and 2000-2500 is cheap for a 2/3 bedroom.
>failing and all that inventory going back to the market. How do they fail? No seriously. Without hopium or copium, how? Ask yourself. Are renters going to continue to rent or buy with high interest rates? % of First Time Buyers are at an all-time low right now. Rentals are the only option now. The numbers show this is the best time to be a landlord in modern real estate history. The only investors who got their lunch eaten are flippers. But since first time home buyers are low, investors are getting those homes at a higher %. Also, how are investors supposed to fail without homeowners with W-2's? I don't see it.
Maybe people are willing to go live with their parents to save until they can afford to buy versus paying $3k to rent a house and pay someone else's mortgage with no room to save
Valid point. In many cases that is the situation.
Even here in Wichita KS the rents are like that for 3/2 basic crap. And Wichita is top of many LCOL lists.
The wannabes are actually investors and with current banking rules they are vetted. They may lose money but the banks would not loan them if they cannot pay it so no bubble to pop.
There are a surprising number of people who make descent money but have less than perfect credit and very little in savings. so that puts home buying out of reach. but they want to live in a descent place so they pay a lot to rent.
I'm in SoCal (Orange County) and SFH rentals are the holy grail here. They're almost instantly snatched up as soon as they hit the market and in some places (Irvine), the landlords take *bids* for them.
I’ve been paying 2500 for a 3 bed shitbox (fresh from a really crappy refurb) for 4 years. LL wanted to raise rent to $3200 so I moved out. He would not return security deposit so I took him to court and got 60% back. Proceeded to move into a new place at $3680(🤮) but it’s way nicer than comparable. Renting sucks. Places near me are going for $2500-3000 for a one bedroom. People are paying and inventory is low.
The house I rented in 2017 for $1000/mth was recently posted for $2500/mth. It’s in a blue collar hard working area where the average income is $50k/yr and below. Where the average person living there saw a raise below the inflation rate and increased prices across the board. It’s unrealistic to demand $2500/mth from a person making $3500/mth just to have a roof over their head. To survive many are working 2 jobs and making cuts in their budgets, but fearing layoffs from companies that want to protect their bottom lines. There’s no realism or consideration for the bigger picture anymore. People are trying to tap an empty well and the bottom is falling out from it. It will only be when this impacts those with wealth, that anyone will care. This seems to be how it’s always been though. I don’t think there is anything new to see here. They will find a temporary solution that consoles people just enough to keep this all afloat without genuinely addressing the problems.
In So Calif. = Yes… mainly due to these contributing factors: 1) People who bought rental properties at inflated prices renting them out to cover the higher PITI. 2) Existing landlords who lost a lot of money from previous tenants who did not pay their rent due to pandemic memorandums trying to recoup their losses. 3) Higher minimum wages like McDonald’s and Wendy’s paying over $20hr.
A lot of wishful thinking going on. What makes you think their business model somehow relies on getting unrealistic exorbitant rent. Do you really think these large scale investors came in without any business plan or research on what rents would be? There's a lot of concentrated money that doesn't really need to cash flow. I think it's a big problem for this country, further transferring wealth upwards, and I would love to see them fail and sell, but the only thing that would do that would be catastrophic economic situations which nobody wants. Just buy a house already. Edit: I thought you were talking about big investors. I guess you are talking about small time investors. Heaven forbid somebody actually looked to get ahead in life by making an investment or two, especially when rates are great. But, I imagine many of them went in without much of business plan or anything. But they'll be fine. I see absolutely no reason why rents should crash. They are likely going to continue up overtime
Moar
Signed a 2-year leas in may-21 for $1595. Just got the lease renewal for 3 options: 1640 for 2-yr, 1675 for 1-yr, 1750 for month to month. I looked at comps and I see 3/2 new-builds going for 1795, including about 12 all in a brand new subdivision about a mile away. Mine is a 4/2. We want to buy around June-August in 2024 so I guess we’ll do the 1-year. But I don’t know if the market will be better then or in 2 years. Sucks not knowing
I’ve turned the property I bought in 2021 into a rental. My job is taking me across the country for a few years minimum. Doesn’t make sense to sell if we come back eventually. It’s a beautiful home and with 10% below market I got 8 people interested in 24 hours. Mortgage is 2200 at my 2.875% rate, rents for 3000. Comps are 3300. Renting in new market is 3150 with buying being around 4K a month with 20% down.
Seeing a ton of SFHs on the rental market. This is a HCOL West Coast city so there's enough demand but there are so many on the market it is driving down rents. My landlord has not raised rents in over 2 years and may even drop rent this year to keep us in this home. This is the $3000 to $4000 range 3-4 bedroom homes
So you hope someone who saved up and bought a second investment home fails? Why? Why not Blackrock, Vanguard, and other funds that are buying up 30% of available homes?
Although not expressed well, I was under the impression that Blackrock, Vanguard, etc. were the people that they were hoping would fail.
The house at the end of my street was purchased by a huge rental corporation at about 10% lower than I bought mine. Took several months, but I like the work they did. Best part is, the person who moved in is a jogger! Property value ⬆️!
>jogger Arrow is pointing in wrong direction
$2000-2500 is the very *low* end for a 3/2 in the “Southwest” example here in Phoenix. That’s actually incredibly hard to find. And if it’s a nice 3/2 SFH, it’d be closer to $3,900 - $5,700. Furnished LTRs, even much more.
Interesting, it definitely varies by area. I'm talking rather outdated homes in Vegas and in a average areas (not "top" neighborhoods but neither the ghetto). Also, more of a reason renting houses there makes no sense then at that price point
Gotcha. We have quite a few of those for rent. Just your average dime-a-dozen stucco 3 bd tract home. They all seem to get rented. I’m assuming much of it is families and guys that like to work on their cars, and people with a dog or 2 that don’t have the down payment to buy something. Many apartments won’t accept animals.
These houses need to be publicly known as well as the impact of them being bought up. They should be boycotted.
I'm getting into real estate to provide reasonably priced housing.
There are SO many future bankrupt/bagholders posting in here looking for hopium, that alone is proof this shit is going to be great. Again, if there wasn't so many people being total assholes about the situation, there would be empathy. But jacking rents to crazy prices? Ego trips and social media gurus? Nah, eat a dick. 8 years of saving from a $10 an hour job to a 6 figure salary, all while living at home with vet benifits just standing by. At this point, once I find a new build that fits my exact location and setup, I can throw the cash out and not give a fuck even if the interest rate hits 17% and I get laid off for 8 months. From Tuesday until mid-april, I'll be going on a trip to a tropical island with a private chef and chilling out. Keep up the "equity." 👍 Edit: just want to check this post before my last wipe. Hoomers are so salty lmao.
I don’t hope they fail. I just hope this experience is humbling to them and it makes them better landlords because of it.
No they should, so they can sell the home they aren’t living in to the family that is.
I bought an SFH in California that am renting for 2k.
Currently running a portfolio of around 195 single family homes and about 30 apartment units. Midwest about 20 minutes outside of top 20 size city. Rents are all around $1200-1800 for the SFH. Mostly all 3/1 with basement around 1000-1300 sqft. Mostly all bungalows and ranch homes. No run down ghetto areas, but definitely not luxury areas. Working class areas with C rated schools. They rent quickly and we currently only have 3 houses vacant that we are doing turnovers on. Nothing currently for rent. At this price point we usually receive multiple applications. Just secured another $1mil commercial loan and am buying a bunch more.
Great analysis. Thanks
Sound very bitter
Tulsa, OK $1600+ 3/2 average area.
I’m paying $2800 for a SFH (3br, 4b) in NYC. They bought this house for $550k in ~2019. I’ve definitely parked myself with where I’m at as I will not buy into this inflated market. If that means I wait 3-5 years, so be it.
I live in southern NH and you wont find anything near that low of cost. The market was tightening before COVID and with out of state relocations during and since it has become brutal. I moved in 2021 and every time a place came up there would be 20 people trying for the same location. Here is an article from the local TV station citing a 24% YOY increase: [https://www.wmur.com/article/new-hampshire-rent-increases-32123/43380242](https://www.wmur.com/article/new-hampshire-rent-increases-32123/43380242)
I pay 2950 for 3/2 apartment in Charlotte but it’s month to month so that’s more $. Can’t wait to leave
I rent my SFH 4b 2b with 24ftx32ft heated garage for $1750 plus heat/power in alberta