How will the drop in housing starts and increased foreclosures affect the cost of single family home rentals?

Specifically, will the cost of renting a single family home, say in California, increase or decrease dramatically?How will the drop in housing starts and increased foreclosures affect the cost of single family home rentals?
Yes it most likely will.How will the drop in housing starts and increased foreclosures affect the cost of single family home rentals?
Ok think of it like this.


First of all the people who loose their homes have to go somewhere and they now can't afford to buy and the lenders' first goal is to try to sell the house so they can recover, but they are being forced to tighten their lending requirements so the homes stay empty, this creates less need for employees to service loans putting more pressure on that section of the work force as it relates to their ability to buy.


Children grow up, get married and leave the nest the banks have tighten the borrowing ability of young people so more new folks are looking for rentals.


The diffferent state and local governments continue to promulgate laws that make it more difficult and more expensive to create homes and apartments so developers create less homes and apartments, putting more demand pressure on the rental market.


They are not making more land on where to create homes or apartments, that's a finite commodity but since I last checked production of babies continue unabated increasing the expenses of young couples.


Since the banks have tighten the lending requirements and there is such a large inventory of foreclosed homes the developers are cutting back on building homes and apartments, cutting back on jobs making it harder for that section of the work force to afford to buy.


Therefore my opinion is that prices for rental will continue to increase.
more people will have to rent, so rental costs should go up, but I doubt dramatically.
My guess is that with that drop, the economy will equally drop, therefore pushing down the monthly cost of rent. If landlords dont do this, they end up with empty rentals because other ';economically wise '; landlords will lower it.
http://www.housing.com


http://www.marketindex.com
In my opinion (based on my experience), rental costs will slide downwards slowly. Therefore you should enter into 6 to 12 months rental agreements only. Nothing longer. Depending on how long this sub-prime issue drags on, your long term plan really should be to purchase a small home (or something you can afford) to start with. Urban areas in California will be the first to rebound once the crisis blows over.
Across the country, there have been thousands of homes built by speculators and gamblers; however, they did not sell. So they have been renting them out. Currently, it is a buyer's market and a renter's market. What used to be $1300/month homes to rent are now only $800/month in my area.





It has been very good for people looking for a break.
ohh it's gonna go up since no one can afford to buy homes anymore. landlords seeing this will increase rent.





demad for rentals will go up, it's the supply and demand kind of thing
they should decrease but no landlord will ever go down on their price so i guess they will level-off till the rise starts again.