Scarcity Strikes the Rental Market Part 1

Pew Research issued a report which shed some light and concern on the rent burden facing many Americans.

It appears according to its report issued in April 2018, the rental market is making home ownership more difficult for many Americans.

“..as more households rely on renting for their long-term housing needs, they are finding the cost of renting increasingly onerous. The steadily rising demand for rental properties over the past decade has reduced vacancy rates to near historic lows, fueling a rapid increase in rental market prices that has outpaced household incomes for many families.”

Rent Burden
This recent new phenomenon is the result of a combination of factors:
1. Low inventory of homes
2. Inability of construction companies to build fast enough to meet demand
3. Rising interest rates
4. High real estate taxes
5. Shortage of lots capable of building multiple rental units
6. Reduced vacancy rates of rental properties (historic lows)

According to a number of sources, renters are spending in excess of 30% of their pre-tax income on rent which creates a financially fragile, cash-strapped class of Americans who have higher eviction rates, decreased financial safety net, and a much wider use of social programs.

“The increasing share of income that goes toward rent may have broad implications for the long-term stability of renter households and for the economy as a whole,” according to Pew Research.

If you have any questions about this information or title insurance, please contact Ralph Aponte: 732.914.1400.

Counsellors Title Agency, www.counsellorstitle.net, founded in 1996, is one of New Jersey’s most respected title agencies, serving all 21 New Jersey counties with title insurance, clearing title, escrow, tidelands searches, and closing and settlement services for commercial or industrial properties, waterfront properties and marinas, condominiums, townhouses or residential single family homes. Counsellors Title also features its own Attorney Settlement Assistance Program™ [ASAP], which is an individual resource customized to fit the needs specifically of real estate attorneys, including, Documentation, Preparation, Disbursement of Funds, Attendance at Closing, HUD Preparation or Post-Closing Matters.

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