LAS VEGAS (KLAS) — When you sell your house to cash in the current housing market, you better have a plan.
Home prices in Las Vegas have started to come back down, and the number of houses available on the market has increased. People who have thought about selling might be thinking if they don’t sell now, they might miss the opportunity to make a big profit.
You have to live somewhere, and unless it’s your mom’s basement, you’re either looking at another house payment — or rent. And if you haven’t heard, rents have gone way up.
If you’re planning on an apartment, the Nevada State Apartment Association (NSAA) says 7.3% of apartments are available — about 12,000 statewide. The average rent is just over $1,400, but that depends on a lot of things. The majority of apartments under construction are aiming at the top of the market.
For existing apartments, the rent averages $1,673 per month for “4 and 5 Star” units. The middle of the market is priced lower, with rents averaging $1,365. And for “1 and 2 Star” units, you’ll pay an average of $1,016. Those figures are updated regularly by NSAA. A recent report said 27.8% of tenants in Nevada have seen rent go up $250 or more in the past 12 months.
NSAA Interim Director Susy Vasquez said, “Typically, we advise beginning your apartment search at least 30 days in advance.”
Figure in the cost of a storage unit if you’re downsizing — and you’d better look for a storage unit ahead of time, too.
Getting information about rental houses isn’t as easy, but moving from owning a house to renting usually doesn’t net big savings.
That leaves another option: relocating. It doesn’t make sense for everyone, but retirement or changing jobs could be reasons to move.
Las Vegas ranked No. 21 in a comparison of housing prices in major cities. The top metro areas were all in California: San Jose/Sunnyvale/Santa Clara, San Francisco/Oakland/Hayward, Los Angeles/Long Beach/Anaheim and San Diego/Carlsbad, with Colorado’s Denver/Aurora/Lakewood in fifth place.
Las Vegas has been an attractive alternative for Californians because home prices here are much lower. But where can Las Vegas residents go that makes sense? A new study suggests the answer isn’t in the West.
Hawaii, California, Colorado and Utah are all far less affordable than Nevada, according to a study by ConstructionCoverage.com that compares states by home prices and earnings potential. The study looked at the median salary for construction workers and the median home price, then calculated how many hours someone would have to work to afford a home in each state, assuming that a worker would spend no more than 30% of their income on housing.
In the Las Vegas/Henderson/Paradise metro area, a construction worker making $23.17 per hour would have to work 66 hours a week to make enough money to bring housing costs down to 30% of their earnings.
For Nevada overall, that number is 67 hours per week, according to the study. Nevada ranked No. 8 overall. West Virginia, Illinois, Oklahoma and Iowa had the most affordable housing.
The nearest states with significantly lower home prices were New Mexico and Wyoming.
Nevada, Montana, Arizona and Oregon were about equal in terms of affordability.
That was especially true for moderates and liberals, but also for some conservative voters like Montoya. Rising housing costs also are a major component of inflation, which was the top priority for voters across the board. For example, the median rent in Colorado Springs has grown 38 percent in the last four years, while home prices are up 70 percent in Pueblo.
It’s part of a national trend, but Montoya wants candidates in Colorado to answer these questions: “Is there a fix in the future? Is there better times? What’s their goal for a year from now, five years, 10 years? Or is it just (prices) keep going up until you’re forced to move out in Colorado?”
With those challenges in mind, CPR News interviewed Gov. Jared Polis, a Democrat, and his Republican challenger, Heidi Ganahl, about their approach to the state’s housing market over the next four years.
Different approaches, same goal: more homes
Housing shortages can be traced to many roots.
The state saw a dramatic reduction in housing production after the Great Recession, leaving it with a shortfall of new apartments, condos and houses. Colorado also is seeing the long-lived effects of under-investment in affordable housing, advocates say. And it’s all been exacerbated by rising costs for labor and materials following the pandemic.
For his part, Polis described housing as a top priority should he win a second term, hinting at significant new steps that could give the state government a stronger role in what gets built, and where.
The governor said the state must work with cities to reform zoning codes and encourage dense, sustainable development along transit corridors, while limiting exurban sprawl.
“It’s a discussion that the state has to have. And if we take action now, I think we can avert some of the devastatingly high housing costs of California and other states,” he said. “You know, people complain about the housing costs in Colorado, rightfully so. But (local housing costs are) still 40 or 50 percent less than California. We don’t wanna become California.”
His challenger, Ganahl, said that housing prices are affecting everyone, including her own 26-year-old daughter, who is living at home in Douglas County because of high rental prices. She described herself as a convener who would help local governments plan for “new, cool, innovative” housing, while also trying to cut regulations that slow construction.
“I will be all about vision, and building a vision for our state and what our future looks like here. And I think we’ve got a lot of opportunity to do things differently,” she said.
For both candidates, government-subsidized affordable housing programs were a secondary focus, even though that’s been one of the state legislature’s main strategies to address housing in recent years.
Instead, they converged on one idea: It’s time for Colorado to build more housing, especially by unleashing private development, and it must do so fast.
Polis says he’ll push for density in second term
Polis said that Colorado’s main housing problem is a lack of housing production. And the state should respond, he said, by encouraging dense and sustainable development.
“In many ways, the lack of housing is a completely contrived problem. It’s a problem of our own making. And we can unleash and remove barriers to significantly more opportunities for housing,” he said.
Housing production in Colorado fell off sharply after the Great Recession. It had nearly recovered as the pandemic set in, but is threatened again now by rising interest rates and a shaky market.
The “bigger issue,” Polis explained, is the “hesitancy” of cities and counties to reform zoning rules and other policies that shape development.
“Really, what we need to figure out as a state is how people can afford to live close to where jobs are,” he said. “Exurban sprawl is not the answer. We need to make sure that we get cars off the road, save people time and money on their commute, reduce pollution and have more opportunities to reduce costs and live affordably, close to where your work is.”
Right now, the state has little direct power to encourage cities to make it easier to build more densely, or to discourage suburban sprawl. It can influence those questions indirectly, especially in how it builds roads and other transportation infrastructure. But it’s local governments who generally make the ultimate decisions about zoning and building codes.
Polis said that under his leadership, the state has already offered “carrots” to encourage what he considers better development. Areas that embrace density and public transit are eligible for larger amounts of federal money under laws passed by Democrats this year.
“What we’ve done is we’ve tied a lot of that to local zoning reforms,” he said.
He described the incentives as an “initial piece” to ensure “that it wasn’t just money shoved into a failing system that fails to deliver housing close to where jobs are, but it (instead) was aligned with incentives for local government to do the right things with regard to an inter-jurisdictional approach to housing,” he continued.
Asked how else he would encourage local zoning reforms, Polis started by describing a “partnership” between the state and cities in his potential next term.
“This is going to be a lot of our work and my focus … is to really solve rather than just pretend to solve, or throw money at, or talk around the edges of the housing affordability crisis in the state,” he said, describing conversations he intends to convene across party lines with everyone from housing, business and industry advocates to environmentalists and others.
But that still leaves a bigger question. Many local leaders have long considered development rules and zoning to be a matter of “local control” — an important concept that has allowed Colorado cities to have power over their own domains. Unsurprisingly, it’s a precedent that local leaders tend to defend zealously.
Would Polis embrace mandates, or a generally stronger role for the state government in housing, CPR News asked?
Polis’ response made clear that he doesn’t see local control as an ironclad rule when it comes to development.
“I think that the state is already involved with housing, of course. What we find more and more is the decisions of one community impact not only themselves,” Polis said.
And issues that cross local boundaries, he said, start to go beyond local control. Local control, he argued, “is about the idea you control your own destiny. It’s not, you control the destiny of your neighbors.”
Polis compared housing to transit, which the state is more active in planning and funding.
“We will succeed or fail as a state based on our ability to deliver housing (so) that people can actually afford to enjoy the great life that our state offers and thrive,” he said.
Ganahl targets regulations, calls for rural opportunities
Heidi Ganahl similarly believes that government is getting in the way of development that could ease the housing crunch.
Asked why housing is so expensive, she said that a quarter of the cost of building new residential units come from regulations, including taxes and fees.
“You’ve got to incentivize builders to build here and make it feasible for them to do business,” she said.
Ganahl named a few specific causes, such as lawsuits over defects in condo construction, as well as taxes, fees and “the regulations and red tape” at both the city and state levels.
Like Polis, she wants to see cities allow for greater development, and she sees herself as a “partner” in making that happen.
“We also have to honor this idea that it’s really up to the local municipalities to manage their growth, but I can partner with them as a governor, and incentivize them,” she said. She’s interested in ideas like redeveloping malls into housing, creating tiny home villages and encouraging European-style development with “smaller, more efficient” units.
It’s not clear yet what she would do to encourage that kind of development over the next four years. Later in the interview, Ganahl reiterated that she was hesitant to interfere with local government decisions.
“I think it depends on the issue, but overall, I defer to local municipalities or governments to make those decisions. But I can certainly incentivize them and talk about other places that are doing it really well around the world and how we can emulate them and make it exciting and fun and creative.”
That’s similar, in principle, to Polis’ use of financial incentives to encourage greater density. But Ganahl said she didn’t support that kind of use of government funds to influence local policy.
“You know me, I’m more about letting the free markets do their thing and using other kinds of incentives. We’ve got a lot of problems we’ve gotta solve in Colorado that we need our government funds for, so I think there’s other ways to do it,” she said.
Asked how else she would incentivize innovative ideas, as she hopes to do, Ganahl said she would work with others to develop a plan. She said she was interested in the work of a group of CU architecture students who have been reimagining main streets, as well as a free market-focused think tank called the Common Sense Institute.
In the same answer, Ganahl added that she would fight for water rights.
“That’s one of the most important things I can do as governor, is not defer to the federal government to decide what’s right for our water. Coloradans should make those decisions,” she said. “And we are the ones who should decide what smart growth looks like, not hand that decision off to the feds.”
She also raised the possibility of helping small towns grow, if they wish, by developing broadband and jobs.
“Let’s make sure they have the tools and resources to attract young people moving into the town, or their kids staying there — like healthy broadband and opportunity. And with this work-from-home shift from COVID, I think it’s very possible to see our growth happen in more of the smaller towns across our state.”
(Polis didn’t raise broadband in his interview, though he signed a recent executive order to develop a plan “to connect 99% of Colorado households to high-speed broadband by 2027,” along with legislation dedicating money to the cause.)
Ultimately, Ganahl said, the state has to work together to plan for its growth.
“I think it comes back to water, for the most part, and making sure we have enough water to grow, at the right pace,” she said. “But this is a conversation we need to have with the people of Colorado and the local municipalities and the small towns across our state about what their heart is for their neighborhoods and their streets,” she said.
What about designated affordable housing?
Both candidates remained focused throughout their interviews on the question of how to encourage and plan for development. They put much less emphasis on funding for designated affordable housing programs, where the government subsidizes development with below-market costs for residents.
The state currently has record amounts of federal money — about $650 million — going into housing and homelessness programs, but those spending levels will recede in the years to come. Aside from this short-term boost, the baseline spending is about $50 million a year.
Voters also have another housing choice on the ballot. Proposition 123 is the first statewide ballot measure for affordable housing funding, obligating the state to dedicate some $300 million of the annual budget to the cause. The measure wouldn’t raise taxes, but instead divert money from other programs.
Polis declined to say whether he supports Prop. 123, saying he’s still reviewing it. Ganahl’s campaign did not respond to a follow-up question about her position on the measure.
Asked if he would prioritize an increase to affordable funding levels in general, Polis didn’t give a firm answer.
“The housing challenge we face is not an issue that we can buy our way out of. And so what I’m more interested in solving are the policy reasons that Colorado has a housing affordability crisis,” he said.
He continued: “Money’s a part of it. Some of that can come from public-private partnerships. Some of that can come from housing authorities. Some of that could come from the state, where we are flush (with money) over the next several years. And there is a question about what we would do in the long term, but it all will be determined, whether it works, by how we’re able to remove barriers to the kind of housing that we need in our state.”
He pointed out that affordable housing generally means rental units, which he sees as necessary and welcome. But he said the ultimate goal is the kind of intergenerational wealth building and secure retirement that comes through home ownership.
“We’d really like to build the (subsidized) affordable housing program. It’s helpful to provide a place to live. But it should never hold us back from the kind of reforms we need to build more housing that’s affordable … for people to be able to purchase and own and benefit from the appreciation.”
Polis added that he supports models like community land trusts.
Ganahl, like Polis, is doubtful that government-subsidized housing can solve the housing problem by itself.
“It’s not working fast enough, so we’ve gotta have some big, bold ideas on tackling this issue, or we’re gonna have some real problems here. Our kids and grandkids aren’t gonna be able to stay here,” she said.
Like more than half of Missoula residents, Mark Gibbons and his wife Pam don’t own their home and instead have sent a rent check to their landlord for the past 23 years.
They love their nice little house near the University of Montana, where they raised their two sons. Pam works at a local grocery store and Mark is an author and teacher. He was named Montana’s Poet Laureate in 2021. So, as they near retirement age, it came as a shock when they got a call from their landlord notifying them that they were being evicted from their home after nearly a quarter of a century.
The family that owns their house has decided to take advantage of record-high prices and sell. A local Realtor estimated it’s going to be listed for nearly $700,000, far beyond their reach. So they’ve had to scramble to find another place to rent in Missoula, where median home sales prices and rents have skyrocketed in the last decade.
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“When you’ve lived in a place as long as I’ve lived in this place, it becomes your place,” Gibbons explained, gazing at the yard where his kids used to play. “You become emotionally attached. You’ve got all these stories, you raise your kids here. And so it’s like a death in a way, or a divorce, whatever you want to call it. It’s an emotional journey to get out.”
His sons wondered if the whole family could pitch in to buy it, but there was just no way to do it on their incomes. For now, they’ve found a temporary place to stay, but it’s much smaller. Moving out after nearly a quarter of a century has taken a toll on Gibbons and his wife.
“It affects people differently,” he said. “I know it’s just knocked my wife for a loop, you know, emotionally, and it’s bothered me but I’ve stuffed it in and replaced it with anger. And I can get pretty angry if I want about the whole Goddamned thing. So I just need to get out, and get away. Time takes care of everything.”
The couple owned a home in Pablo at one point, but they never felt right about buying a home in Missoula. When they first moved in, they had what they felt was a pretty good deal on rent with the owner for about $800 a month. However, the owner eventually passed away and the house was put in the possession of a trust owned by his relatives. Over the years the rent kept getting slowly increased. Gibbons would always grumble a little bit but kept paying. Still, he was blindsided by news of the sale. Now, he regrets never buying a home of his own. He didn’t think it would come to this.
“I’m not an economic wizard, obviously,” he admitted. “But it’s just the lack of decent family-sized housing.”
So this summer, Gibbons has been exposed to the brutal real estate and rental markets in Missoula after 23 years. He was shocked at the prices he saw for even the smallest apartments. Luckily, a friend let him rent a condo. Now Gibbons commiserates with people like his neighbor, who is also getting evicted because the house is being sold.
“It’s just a really bad time for renters,” he said. “My wife and I have resources and connections in the community because we’ve been here so long, but a lot of people don’t. It’s a shit show of a problem with all the gentrification and the Airbnb world and property taxes because of the massive houses.”
Housing prices have soared in western Montana since the start of the pandemic, and Missoula County saw record-breaking increases. The median home sales price was $315,250 for all of 2019. That number jumped to $575,000 in June of 2022, an unprecedented 82.5% increase.
“We realize the numbers are grim,” exclaimed Mandy Snook, the president of the Missoula Organization of Realtors, in an April 2022 meeting about the housing market. “And we are not happy about the direction that they are heading. There are not enough housing units for sale or rent. We are out of balance and in a crisis.”
In Ravalli County, the median home sales price went from $309,000 in 2019 to $682,500 in June of 2022, according to the Missoula Organization of Realtors. That’s a whopping 120.8% increase.
The story was similar in Sanders, Mineral, Lake, Granite and Flathead counties, and in fact, for almost everywhere in Montana.
Local real estate agents noticed an increase in out-of-state buyers, and data showed that the percentage of all-cash buyers increased during the pandemic.
Brint Wahlberg, a Missoula Realtor, noted that all-cash purchases in Missoula County have increased from 17.74% of all financing methods in 2020 to 23.52% in 2022.
“That’s more than one out of every five home purchases,” he said.
Realtors who specialize in land and ranch sales reported having their busiest years ever.
The surge in demand was coupled with a lack of supply because builders have not kept pace with the number of homes that should be getting constructed just to keep up with population increases, let alone a spike in interest from out-of-staters.
“We’re in an under-supply of about 2,400 units,” according to Karen Hughes, the assistant director of Missoula County’s community and planning department. At one point in 2017, there were nine single-family homes listed for sale when the Missoula Organization of Realtors estimated about 6,000 people were looking to buy one. Realtors have been astounded at bidding wars that have drastically put upward pressure on prices, shocking both buyers and sellers.
Wages have also not kept up with rising home prices. The median family income in Missoula County has risen by just 15% since 2010, while the median home sales price has increased by 180% in that time.
Rent prices also surged. In 2021, average rents increased 5.6% over the year, with increases accelerating in the second half of the year. The average rent for a two-bedroom apartment stood at about $1,064 per month. The average vacancy rate for the year was about 1.3%. Most experts say a healthy vacancy rate is somewhere between 5% and 8%.
“This is the first year that I’m seeing a two-bedroom apartment in a standard multiplex go for more than $1,000,” explained Paul Burow, a local Realtor and property manager.
He noted that in the first quarter of 2021, the rental vacancy rate was 1.2% and the number dropped to .9% at the end of the first quarter of 2022.
Some efforts to ameliorate the situation have been successful, and others have failed.
In Missoula, over 400 units of income-restricted apartments are under construction, including the largest single affordable housing complex in Montana history. However, experts say hundreds, if not thousands, more are needed over the next few years.
In Whitefish, the city council banned tourist rental homes in large portions of the town as prices there push out workers.
Montana Gov. Greg Gianforte created an affordable housing taskforce in the summer of 2022 as a response to the crisis.
However, Gianforte, a Republican, also vetoed a bill passed by the Republican-controlled state Legislature that would have created state Low Income Housing Tax Credits.
In his veto message, Gianforte said HB 397 would cost $45 million and would have tied Montana credits directly to the level of available federal housing credits.
“Considering current and ongoing federal funding for affordable housing development and rental assistance, HB 397 is unnecessary legislation that would have an unjustified long-term fiscal impact on the state,” Gianforte said.
The bill was supported by several nonprofits that build low-income housing in Montana.
“Since 2016, the Montana Board of Housing has denied over $310 million in federal housing tax credit requests due to lack of funding, half of which were from Montana’s small towns,” wrote Homeword executive director Andrea Davis in an op-ed published in newspapers across the state in May of 2021. “Montana missed the opportunity to build 2,000 new affordable apartments and create 4,000 construction jobs with over $186 million in wages.”
In 2021, there were 14 applications (six from small towns) for the federal tax credits totaling $81 million in construction, Davis wrote. However, she said, only $29 million in federal tax credits were awarded, which was only enough to fund 115 to 130 affordable apartments.
“Montana’s continued economic recovery relies on a strong workforce,” Davis wrote. “A strong workforce relies on homes that workers can afford to rent.”
We’re trying to decide if now’s the time to buy a house. We’ve been outbid numerous times, and our landlord wants to raise our rent. Should we wait or keep trying?
Squeezed by Rising Rent
Dear Squeezed by Rising Rent,
My answer is yes — to both. Exactly if or when to stop renting is not a decision I can make for you, but I can offer some advice.
The value of real estate continues to be determined by the age-old maxim: “location, location, location.” Since I have no knowledge of the market that you are in, I will respond with some market insights and a few tips from my own experiences. You and your spouse can decide the answer to your question, but it is good to be patient (wait) and keep trying.
The market is cooling
Numerous professionals say the housing market is cooling. High home prices (driven by COVID, remote work, and a supply/demand imbalance), a doubling in mortgage rates, inflation/recession, and a shaky stock market are contributing to slower sales. There is a slowing of appreciation as well: homes in areas that appreciated 10% or more may only rise 5% in the year to come, or even 0%. CoreLogic expects home prices to rise 4.3% from June 2022 to July 2023 on a year-over-year basis. This should be helpful in determining the likely costs of waiting.
Characteristics of a cooling market
Depending on your city or region, you may begin to see the effects of a cooling market, which are listed below. These should work to your advantage:
- Lower listing prices.
- Price reductions after listing.
- Longer days on the market.
- Fewer bidding wars.
- Contract cancellations.
Are we in a housing bubble?
What we see today is different from what we experienced back in 2007–2008. That was a housing bubble defined by rampant speculation, a huge run-up in prices, and too many homes for sale without significant demand. Another factor was the number of homes sold with questionable loan financing to subprime borrowers. Many borrowers had no equity, used an option ARM, or were not qualified buyers. The only factor we have in common in today’s market is high prices.
A housing recession?
An article here states that The National Association of Realtors reports that housing affordability has plunged to the lowest level since 1989. According to Redfin, the median sale price was $371,125 in the August timeframe, up 6% from the previous year. However, sale prices dropped 6% after peaking in June when the median price was $394,775. Industry experts are calling this a housing recession, which does not mean the market is crashing.
Realtor.com reports that homes may remain on the market longer, but they still spent 26 fewer days on the market this July than in 2017 and 2019.
Natalie Pace reports that home builder D.R. Horton had cancellation rates of 24% in 2nd Q 2022, up from 17% a year ago. Redfin warned that 60,000 home-purchase agreements were canceled in June — the highest percentage of buyers backing out of deals since 2017. Inspections and appraisal contingencies allowed buyers to exit. Others walked away when they no longer qualified for a loan or could not come up with a down payment. A third of June sales were first-time buyers while 16% were from investors and 2nd home purchasers. Since families prefer to move during the summer months, more price corrections may be noticed during the upcoming seasons.
These 10 cities had the highest number of price drops in July, per Redfin: Boise, Denver, Salt Lake City, Tacoma, Tampa, Sacramento, Indianapolis, Phoenix, San Diego, and Portland.
These are the cities where actual home prices are falling the most, per realtor.com: Toledo, OH; Rochester, NY; Detroit, MI; Pittsburgh, PA; Springfield, MA; Tulsa, OK; L.A., CA; Memphis, TN; Chicago, IL; and Richmond, VA.
Realtor.com says a house may be overpriced if:
- It has been on the market for a long time.
- It is priced higher than comps (comparisons) in the area.
- It has been on and off the market several times.
- Houses around it are selling, but the one you are looking at has not sold.
- Many homes in the neighborhood are listed, but few are selling. Could be due to price, a change in zoning laws, an HOA battle, etc. Find out before making an offer.
The cooling housing market impacts sellers, carpenters, landscapers, and other businesses in building and renovation. Declining sales, inflation/recession, and the higher cost of consumer goods will reduce many homeowners’ desire (and ability) to remodel, update, or make important repairs.
Buyers are beginning to experience FUD (fear, uncertainty, doubt). Coupled with low cash reserves, some are choosing to stay put in their current housing situation. This will work to your disadvantage as many will choose to continue renting, thus giving landlords the leverage to increase rents.
Buying too big of a house or overpaying for one can negatively affect your finances for years. Many people are experiencing buyer’s remorse because they got caught up in the real estate frenzy and are now underwater or unable to keep up with the expenses of home ownership. Pandemic checks have been spent, and consumer debt is up. Combine that with maintenance, repairs, higher utilities, groceries, etc., and it is easy to understand the discouragement.
Patience is good
The good news is that qualified buyers who have waited patiently may soon be able to find what they can afford. Whether hoping to sell or desiring to buy, trust the Lord, and seek wise counsel.
“Rejoice in the Lord always; again I will say, rejoice.Let your reasonableness be known to everyone. The Lord is at hand;do not be anxious about anything, but in everything by prayer and supplication with thanksgiving let your requests be made known to God. And the peace of God, which surpasses all understanding, will guard your hearts and your minds in Christ Jesus” (Philippians 4:4–7 ESV).
While seeking the Lord’s guidance and patiently waiting, one way to improve your finances is to reduce or eliminate credit card debt. Christian Credit Counselors is a trusted source of help toward financial freedom.
Chuck Bentley is CEO of Crown Financial Ministries, a global Christian ministry, founded by the late Larry Burkett. He is the host of a daily radio broadcast, My MoneyLife, featured on more than 1,000 Christian Music and Talk stations in the U.S., and author of his most recent book, Economic Evidence for God?. Be sure to follow Crown on Facebook.
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Editor’s note: This story is part of an ongoing series on affordable housing in Oklahoma City in partnership with the local media collaborative Oklahoma Media Center, the nonprofit newsroom The Frontier, The Oklahoman and the Oklahoma City-based magazine Curbside Chronicle.
When a faulty gas line left her without heat last winter, Valeria Lopez used her electric oven to try to keep warm at her Oklahoma City apartment.
Space heaters put too much of a strain on the old electrical wiring and she can’t risk turning on too many appliances at once or the lights will go out with a loud “pop.”
Lopez has few options when she has to move out of the Foxcroft Apartments at the end of September. Affordable housing in Oklahoma City is getting increasingly scarce. Out-of-state investors are driving up prices for single-family homes and multi-unit properties in the city, pushing low-income people out of the market. Oklahoma also has inviting eviction laws for out-of-state landlords, with few protections for renters.
Lopez lives with her adult daughter, who is pregnant, and a 9-year-old granddaughter. At Foxcroft, she pays $765 a month for rent. It’s been hard to find another home in her price range with enough space.
“There’s nowhere to go. The only thing I could do is rent a hotel room — just temporarily,” Lopez said.
The Foxcroft Apartments on NW 16 near Interstate 44 has cycled through several owners during the 10 years Lopez has lived at the complex.
An investment group with at least one member in California with vast financial resources purchased the property for $7.4 million in September 2021 and promised a multimillion-dollar renovation, but maintenance problems have persisted. Tenants are locked in a lawsuit with the new landlord over the heating problems. The complex swimming pool is still closed and filled with dead insects, even though the new owner has invested money in new equipment and decking.
Even with these issues, Foxcroft residents say rents at the complex are going up by as much as $200 a month as the landlord tries to move them into more expensive, renovated units at the complex. That leaves Lopez stranded as rents spike across Oklahoma City.
Property owner Foxcroft Exchange LLC said it has offered to move tenants without heat to renovated units rent-free until their existing leases expire. But Lopez says the offer doesn’t apply to her. Her lease agreement has already lapsed, and the new owner has repaired her HVAC system.
Maintenance problems, including no central heating and a gas line full of leaks existed before Foxcroft Exchange purchased the property, the company said in written responses to questions about living conditions. The company said former owners are to blame for the lack of upkeep.
“Committing $2 million in property improvements in less than one year is a significant development for the complex which was in grave disrepair,” Foxcroft Exchange said in a statement.
Oklahoma City sees rising housing costs
Average rental rates in the city have increased by more than 10% over the last year, according to data from the real estate marketplace company Zillow.
“We’ve got one of the fastest emerging cities in the country,” said Grant Cody, director at the Oklahoma Real Estate Commission. Investors from California, New York and Texas are coming into Oklahoma, targeting the most rundown multi-family properties to purchase, he said.
“That’s how they can make the biggest profit margin, and that’s all they care about,” Cody said.
It can be a positive for communities when new owners invest in renovations, increasing property values, said Karey Landers, executive director of the Apartment Association of Central Oklahoma, which represents property owners and others in the industry. Oklahoma City also has an overall shortage of affordable apartment units and high occupancy rates, putting pressure on rent prices.
Decades-high inflation is hurting landlords too, factoring into rent increases, Landers said. The price of pool chemicals has spiked nearly 50% over the past year. Cost increases on everything from flooring, lumber and household appliances have hit landlords hard, she said.
“Everything else is going up, and they have to be able to keep up and pay their bills, just like anyone else,” Landers said. “And that money has to come from somewhere.”
Investment firms are also scooping up a growing share of single-family homes in Oklahoma City. By 2030, institutional investors — some backed by private equity funds — are projected to own nearly half of single-family rental properties in the nation, according to one research report by Yardi Matrix.
Oklahoma ranked third in the nation last year among states where institutional investors are buying single-family homes, according to the National Association of Realtors. In 2021, institutional buyers accounted for 18% of all single-family home sales in the state. Oklahoma County had the highest share of sales to institutional investors in the state, making 29% of home buys in 2021.
Entire neighborhoods have disappeared from the city’s affordable housing inventory. Oklahoma City’s Classen Ten-Penn neighborhood was once lined with homes that sold for less than $100,000 and rented for less than $600 a month. But even people with moderate incomes are now being priced out of the area, said broker Jennifer Arsenault.
“These are wild increases, something we’ve never seen in Oklahoma,” Arsenault said. “People are completely boxed out of the market.”
As rents are going up, the cost of buying a home has gone up as well.
Arsenault has spent the past five years tracking the city’s affordability index, which is a measure of the financial ability of families to buy a home as an alternative to renting. The index shows fewer families than ever have the financial ability to purchase a house in the city as home values increase.
Even with housing assistance, renters struggle to find affordable homes
People with lower incomes struggle to find affordable rental units even with Section 8 housing assistance, said Richard Marshall, director of leased housing for the Oklahoma City Housing Authority. Section 8 vouchers are a federally funded rent subsidy paid by local housing agencies to landlords to help low-income people secure housing. More than 6,200 people were on a waiting list for vouchers as of June, and the Oklahoma City Housing Authority reports the wait for a unit can be 15 months to two and a half years.
“You’ve got a lot of outside investors coming in buying up apartment communities, and increasing the rents to a level that’s beyond what we can pay and pushing our tenants out,” Marshall said.
Older apartment communities that once welcomed Section 8 also are disappearing from the city’s shrinking affordable housing inventory.
Even with a housing voucher, it took Oklahoma City resident Krista Sullivan at least six weeks to find a one-bedroom apartment near family that she could afford. She found a place she liked in Edmond, but the property stopped accepting Section 8 vouchers after it sold to an out-of-state investor last year. Sullivan has nerve damage and deals with chronic pain, so she uses a walker to get around. When she arrived for a tour of another apartment in Oklahoma City, she discovered it was up a flight of stairs.
“I went home defeated,” she said. “Being poor sucks.”
With few other options, she decided to rent the unit. Now she takes the stairs slowly, gripping the railing, and has her groceries delivered.
Some complexes are being renovated or seeing rent hikes after being bought by out-of-state investors. Mike Buhl, owner of Norman-based Commercial Realty Resources, reported in March that investors from New York City, Dallas and elsewhere, paid nearly $1 billion buying up a record 12,113 Oklahoma City apartments in 2021.
The “We Love Section 8” banner displayed at the Grand Boulevard Townhomes, at 2269 NE Grand, came down earlier this year as new out-of-state owners evicted tenants and began renovations. The complex was once a longtime source of code complaints, with some units boarded up or in disrepair. But the rents were cheap, advertised at $529 a month in 2019.
The property sold for $2.9 million on Jan. 20. Opal Investment Group, the New Jersey real estate investment fund that owns the complex, and brokers at Dallas-based The Multifamily Group representing the property did not return calls. Opal Investment Group lists 15 older multi-family properties in its online portfolio.
A brochure The Multifamily Group sent out to market the Grand Boulevard property touted $12 million in “upside potential” if a new owner invested money for renovations, raising rental rates by up to $444 a month per unit.
Such rent hikes can be prohibitive for low-income tenants who also have trouble affording the costs of moving to a new apartment and paying for a deposit.
A single person working full-time at minimum wage would have to pick up a second job or get a roommate to afford a one-bedroom unit at $821 a month, which is what the U.S. Department of Housing and Urban Development calculates as fair-market rent in Oklahoma City.
Attorney Richard Klinge, director of the Pro-Bono Housing Eviction Assistance Program, said some landlords move tenants from one unit to another during renovations and then hike rent when the work is done.
“The rent increases are happening,” Klinge said. “When my clients’ leases are up, they’re getting huge rent increases. On lower-income people this can be really harsh.”
Few rights for tenants
Evictions are increasing as housing costs rise. In Oklahoma County, eviction filings were up 7.3% above average in July, according to data from Legal Services Corp.
“It’s a horrible problem we’re facing,” Klinge said. “We just bury our heads in the sand and don’t give people needed protections. It’s not a fair fight. The landlord has all the power and the tenant has none.”
Under Oklahoma law, the legal burden of proving that a landlord has failed to make repairs falls to tenants before they can break a lease or withhold rent without getting evicted.
Even with the state’s weak protections, Foxcroft tenants were able to get an injunction in January against the landlord from evicting them for non-payment of rent until the gas is fixed. The injunction also allows tenants without gas service to break their leases and move without penalty.
The company Foxcroft Exchange LLC has owned the complex since September 2021. Property tax, business records and a tenant’s check deposit indicate the new owner has ties to the Los Angeles-based real estate investor Jay Schuminsky, the CEO of the Mustang-based company All Storage.
All Storage operates more than 50 self-storage facilities in Oklahoma and Texas and began soliciting offers to sell the business last year in a transaction that could fetch $1 billion or more, Bloomberg reported. Schuminsky runs Lightbulb Capital Group, which describes itself as an investor in luxury apartments in “high growth markets”. He’s also written columns for Forbes offering tips on investing in commercial real estate.
In one 2019 column, Schuminsky chided landlords who refuse to do repairs and maintain real estate investment properties as “both apathetic and short-sighted.”
In response to written questions about Schuminsky’s involvement in the property, Foxcroft Exchange said it was committed to making substantial renovations to improve the property.
“We are a locally owned investment company with investors that believe in the standard of taking care of our neighbors and specifically, tenants of our properties,” the company said.
The Foxcroft tenants are being represented by attorneys Chis Cotner and Ryan Owens, who in January successfully won an injunction against the landlord from evicting tenants for non-payment of rent until the gas is fixed. The injunction also allows tenants without gas service to break their leases and move without penalty.
“They still haven’t gotten all the gas fixed,” Cotner said. “There is a dispute as to whether or how much they knew about the gas lines. The people who bought it claim they didn’t know or didn’t know the extent of the problems. But that’s not our problem, and it’s certainly not the tenants’ problem.”
Residents without gas service have been told they must move to units on the other side of the complex that have been renovated, so the landlord can eventually begin charging them rent again — at higher rates.
“Ultimately, our priority objective is to move all residents to units where central heating has already been restored,” the company said. “Moving them isn’t to force them to pay rent again but to ensure they are in the most comfortable units we can offer as winter weather approaches.”
Foxcroft Exchange said it has tried to work with tenants, but residents are also free to move.
Owens said he does not believe the rent hikes are allowed under the injunction.
“If we didn’t have an injunction in place, landlords don’t have to rent to anybody and tenants don’t have to rent from anybody,” Owens said.
Oklahoma’s weak protections for renters make it easy for landlords to evict tenants but offer few protections for tenants against landlords who fail to make repairs. Recent changes to statutes allow tenants to deduct repair costs for up to one month’s rent.
Legal representation for tenants is limited in Oklahoma and Cotner notes that many tenants don’t understand what rights they have under the law or know how to contest an eviction in court.
“If you’re not paying your rent, it doesn’t matter what the landlord is or isn’t doing,” Cotner said. “And do you have the time to show up in small claims court?”
Cody is hoping both local leaders and state lawmakers will focus on the affordable housing challenge, especially in matters involving speculative buyers and efforts to fix housing costs. He estimates thousands of residences have disappeared from the city’s affordable housing inventory.
“I don’t think we will ever get back the inventory we’ve lost with affordable housing,” Cody said. “It is gone. Those affordable homes are not coming back.”
(The Center Square) – Rent increases, fewer available rentals, and average single-family home prices up nearly 17% demonstrate Alaska’s tight housing market, according to a new report.
Alaska saw rents up more than usual in three of its largest markets, including Anchorage recording its largest single-year increase in two decades, the Annual Renter Survey by the Alaska Department of Labor and Workforce Development shows.
In general, rent changes in urban Alaska have followed the national trend since last year, the report showed. In Alaska, the median adjusted rent was $1,276 at the time of the survey in March, up 8% from the previous year.
It’s possible recent cost increases since the survey was conducted will drive rents even higher than that, the report said. However, it went on to say rent is still affordable on average. The U.S. Department of Housing and Urban Development considers housing affordable if the occupants spend no more than 30% of their income on housing costs, the report said.
“While rents have risen everywhere since 2020, rising wages have made renting more affordable in all surveyed areas except Anchorage, where rent increases have outpaced average wage growth,” the report said.
Declining vacancy rates were attributed to several factors. The increase in home prices and interest rate hikes likely prevented renters from making the leap to becoming homeowners.
“Normally, the flow of renters buying homes each year steadily frees up rental units, but house prices jumped during the pandemic, pushing some prospective first-time buyers to keep renting longer,” the report said.
The price for a single-family house averaged over $388,000 in 2021, up almost 17% from 2019, according to the report.
“Interest rates increased sharply in early 2022 while home prices remained high, pushing the average monthly mortgage payment up and putting home buying even further out of reach for some,” the authors wrote.
Another likely factor contributing to low vacancies was emergency rental assistance, leading to fewer evictions and thus fewer available rentals.
The report also listed an increase in short-term rentals as a possible contributor.
“It’s not clear how many units in Alaska are moving from long-term to short-term, but national studies have found that in other parts of the country, short-term rentals can deplete long-term rental stocks. Anecdotally, our survey did suggest some Alaska units are transitioning to short-term rentals,” said the authors.
Meanwhile, there are more people moving out of Alaska than there are people moving in. Alaska’s gross migration rate has topped the list for the last 14 years in a row, according to Internal Revenue Service data. The gross migration rate represents the total number of people moving both in and out of the state.
When you ask the couple about the stories they’ve accumulated over this journey, they look at each other and laugh.
“So the emotions, I guess, rollercoaster,” said Byard with a laugh.
One of their more infamous stories was at a property in the Lower Highlands neighborhood, in Denver’s Northside. The first shocking part to them was when Byard said they saw the property originally listed online for $2,600 and within the time for a short debate; it was taken down. The next day he said it was listed again for $100 more per month.
Still, it was within their budget so Byard and Slaughter applied again and viewed the property in the quickest way possible — virtually. They liked the property and submitted an application. Within a few days, the landlord responded saying they were among the top candidates and asked for them to provide their best offer including “rent, term, etc.”
“I think we both started laughing because it just seemed so outrageous to hear something like that,” said Byard.
They realized they were essentially in a bidding war for a rental, something they’ve heard about in New York but never here in Denver. They didn’t want to get involved in that for just a rental property, as opposed to now-common bidding wars for owning homes in the area.
[Related: How to Survive a Rental Bidding War]
“And I just explained, ‘As renters we have nothing to gain by offering you more money for what you listed as.’ And I was like, ‘But what we can offer you is the peace of mind of responsible tenants ‘cause that’s priceless.’ And needless to say we did … not move forward with that.”
“I think it sets a bad standard as a renter to go in there,” said Slaughter. “It makes you feel from the get-go that you don’t really have as many rights as a renter that you would normally have. And I think it just sets a bad precedent.”
For Slaughter, the more frustrating part of their 2022 summer search was never really knowing why they weren’t picked for a rental property. She compares it to what it can be like to date these days.
“It seemed like you both really liked each other, and then they just ghost you or, like, they finally get back to you and they say, ‘Oh, we went with someone else.’ And you’re like, ‘But why? What was wrong with us?’” she explained.
That is exactly why one of the most anxiety-inducing application and denial moments for her was when she decided not to let a rental agency ghost her. Slaughter said they were one of the first ones to view and apply when this property became available. Then they didn’t hear back for three or four days and finally received an email saying the property went with a stronger candidate.
“And so I got the guy on the phone and basically started crying at that point, which I’m not proud of, but it just happened,” she told Rocky Mountain PBS with a laugh. “And I was asking why. And he said, ‘Because we didn’t have three months times the monthly rent in pay stubs that they went with a stronger applicant. Even though I have savings, I’m in nursing school, a second degree student, very responsible in my 30s … great credit scores, all the things. And because we didn’t have those pay stubs, they went with someone who had more money.”
At the same time, Slaughter and Byard battled against other renters, Slaughter’s lease ended and she was forced to pay month-to-month, increasing her rent by about $700. Slaughter thinks the price increase with a month-to-month lease is another unfair practice in the rental market.
The current rental market, by the numbers
“It’s fairly tight,” said Ron Throupe, speaking about the current Denver-area rental market. As an associate professor at University of Denver, he contributes to a quarterly report about the current rental market.
The second quarter’s reportpublished at the beginning of the month shows rents are continuing to increase to an average of $1,859.51. That is an increase of nearly $94 from just the previous quarter.
“That’s a big increase, but seasonally, that’s not unexpected to have,” said Throupe. “We tend to have our rent increases and then we sort of fade out in the fall/winter, and then we recycle again the following year.”
The report also showed the vacancy rate — the percentage of all available units in the city — is currently about 4.7%, a slight increase from the first quarter and a one percentage point increase from 2021. Still, that number is lower than the national vacancy rate of 5.6%, according to the latest report from the U.S. Census Bureau.
Part of why Denver is experiencing a “tight” rental market, according to Throupe, is the continuing popularity of the city.
“Denver has become a … let’s call it a ‘found city’ in the last five years and is very attracted to move here for people,” said Throupe. “I tell people Denver’s no longer the cow town.”
Another element to consider is the recent increases to mortgage rates, which are predicted to continue to rise. As mortgage rates go up (and, therefore, monthly prices), those who were close to being able to buy a home may decide to stay in a rental for a while longer, therefore keeping the market tight.
The rental report also showed that in the second quarter, just more than 4,000 apartment units were added to the city’s inventory. Overall, Throupe didn’t express concern over the rental market in Denver and again pointed to the reality of the growing city.
“Do I worry about prices going up too fast? Well, you put it in perspective: those who have been here a long time think it’s incredible, right? But for those that have been other places, especially the coasts, they don’t think so,” explained Throupe.
“To me [it] almost seems illegal, like it just seems discriminatory,” Slaughter said with exhaustion after she heard they weren’t picked for a rental because of lack of pay stubs.
Colorado, like the entire country, has fair housing laws that have been updated and revised since they were first instituted decades ago. Colorado was the first in the nation to pass anti-discrimination laws governing private property in 1959, before the signing of the federal Fair Housing Act in 1968.
Despite being the first to pass such laws, housing in Denver was restricted as realtors and bankers worked together to segregate Black homeowners in the Five Points and Capitol Hill neighborhoods. In the meantime, white homeowners used their privilege of mobility to create distance.
Colorado’s current fair housing laws do not allow for discrimination against protected classes with now include race, creed, color, religion, sexual orientation, marital status, national original, source of income and others. The laws also define a number of unfair practices like refusal to rent or sell or applying unequal terms.
[Related: Denver Tenant Rights & Resources]
If someone does feel unfairly treated or believes something illegal has occurred, they can file a complaint with the Department of Regulatory Agencies (DORA) Colorado Civil Rights Division (CCRD). However, the burden mostly rests on the individual to file a complaint. The Denver Metro Fair Housing Center is a nonprofit focused on eliminating housing discrimination by educating Denver-area residents and conducting investigations.
Still, rental agencies and private owners have a lot of leeway to increase prices fairly when the market is as it is.
“Every lease is a negotiation,” said Throupe. “They can negotiate any number they want … if they sense the market is tight or they only have one unit left and they’re in a prime area — yeah, they’re gonna move the rent.”
Finding a place
After experiencing the most stressful search for a place to rent in Denver Steph Slaughter and Chris Byard had ever gone through, they took to social media.
Byard helps cohost a local podcast, Stoned Appetit, and shared his bidding war woes with their Instagram followers. Hundreds of people empathized with Byard and Slaughter and dozens responded with similar stories or comments on the rental market. The posting also finally ended Slaughter and Byard’s search for a place.
“It’s through a friend who actually saw the posting about it on Instagram, and she has a rental property that they bought like 10 years ago here in Denver. And now they’ve moved out to the suburbs, and it just happened to be available,” said Slaughter. “It was really the luck of the draw.”
Now set on their place within their price range, the couple plans to move into the property soon and still feel sorry for the many others out there still trying to find a place, especially those who may have other barriers to face.
“I can’t imagine people that have gone into debt with the pandemic and now try to rent because they can no longer afford the apartment they’re in then their credit scores lower,” said Slaughter. “I can only imagine those hurdles.”
For Byard, he is most worried about continuing gentrification and the pricing out of people from the neighborhoods they’ve come to settle in and truly make a home.
“I don’t think people should have to make that big of a sacrifice that they’ve lived here for so long, and now they’re just saying, like, ‘Oh my gosh, I really can’t afford this,’” said Byard. “That displaces you from the community you’ve been involved with.”
For this couple, their advice for people in search of a rental is ultimately to turn to their community.
“Talk to your network. Like, talk to your friends, talk to your workers at work,” Byard said. “Somebody knows somebody.”
Amanda Horvath is the managing producer with Rocky Mountain PBS. You can email her at firstname.lastname@example.org.
Alexis Kikoen is the senior producer at Rocky Mountain PBS. You can reach her at email@example.com.
I’m a 68-year-old single, retired nurse. I own a condo that’s worth approximately $450,000 in New York City. I have a nice amount in savings and in investments, worth about $1 million, and a good amount in Social Security and in pensions.
Here’s the problem: I hate living in New York City. It was great when I worked 8 blocks away for 33 years, but now it’s very lonely, and I’m away from family.
I want to move to a beachside town in New Jersey. But given the market right now, do I buy or do I rent? And do I sell my place or do I rent?
My head is spinning and filled with fear about making the wrong financial decisions. Please help!
No More New York
‘The Big Move’ is a MarketWatch column looking at the ins and outs of real estate, from navigating the search for a new home to applying for a mortgage.
Dear No more New York,
Having lived in New York City myself, I know the struggle. The city’s amazing when you’re young, you’ve got plenty of things to do, and plenty of easy food options nearby for when you’ve got no time to cook for yourself.
Plus, when you’ve got a demanding job that you can walk to eight blocks away, it must’ve been a dream, especially after working night shifts as a nurse.
But life happens, and things change.
I sympathize with your desire to move to a quieter place. I made this exact change myself. New Jersey is a great option because you’re not only able to enjoy a quieter pace of life (less sirens, for one), you’re also going to be closer to family.
You’re also going to be saving on city taxes, which can be hundreds of dollars, depending on your income.
But there are a couple of cons to consider before you make the move.
“‘Property taxes in New Jersey are more than double the national average and the highest in the country.’”
You’re not going to be able to get around as easily as you did before. New Jersey doesn’t have as great a subway system so you may need to invest in a car (if you don’t already have one), which could be an additional expense.
And if you decide to buy a home, property taxes are a lot less friendly in the Garden state, compared to New York, and especially the five boroughs. “Property taxes in New Jersey are more than double the national average and the highest in the country,” Bill Kowalczuk, a broker at Coldwell Banker Warburg, told MarketWatch.
If you know exactly you want to be near family, and you’re very sure of the area, you’re confident that you’ll have enough things to do during your retirement, then maybe it’s worth selling the property in Manhattan and going all in into a new single-family home in New Jersey.
But since you’re not sure of what to do, given how rents are trending in the city, it may be a good idea to put your condo on the rental market. I’m guessing your condo is in Manhattan if you’re able to walk to work, so here’s a spot of good news for you: The average rental price in Manhattan as of July 2022 is $5,113, according to Douglas Elliman. The median is $4,150.
Rentals are going to be far cheaper in New Jersey, so you can probably save a little.
Not sure which beach or town you’re targeting and the prices quoted vary by state, but the average rent in Atlantic City, N.J. was $1,575, according to Zillow, as of Aug. 24. The median rent in Avalon, N.J., which is in the county of Cape May, was $1,450, according to Zillow.
Given your assets and your pension, you’d have extra income from the rental, that would help cover the cost of living.
I know your head is spinning and the economic situation is making you feel uncertain, on top of this worry that you may be making the wrong move.
You’re not alone. A lot of people feel uncertain and have decided not to buy at the moment, for the same exact reason.
But once you feel like you’ve got a strong sense of where you want to live and feel strongly about setting down roots, then you should make plans to sell your home and jump on a property in New Jersey.
Because renting long-term can get pricey. And it looks like home price appreciation has slowed, but hasn’t fallen.
Got thoughts on the housing market? Write to MarketWatch reporter Aarthi Swaminathan at firstname.lastname@example.org
There are growing concerns a drop in investors buying into Tasmanian real estate could further shrink the availability of rental properties in the state.
- Overall, Tasmanian house sales have continued to trend down for the second consecutive quarter
- Despite the falls, property sales for the June quarter were still slightly above the 10-year average of 1,739 properties
- Mary Bennett from Anglicare says the drop in investment is concerning if it means properties are leaving the long-term rental market and not being replaced
The number of investors purchasing a Tasmanian property in the June quarter fell by 20 per cent compared to the previous quarter.
Out of 1,781 properties sold, just 16 per cent were purchased by investors, with even fewer Hobart properties (12 per cent) purchased as investments.
“That’s a worry,” the president of the Real Institute of Tasmania, Michael Walsh, said.
He fears properties being sold could be removed from an already tight rental market that has a current statewide vacancy rate of about 1 per cent.
“That’s probably a big discussion to be had on the implications for the rental market,” he said.
Mr Walsh said 30 per cent of buyers needed to be investors to properly support the private rental market.
“We just don’t have the private investment right now that tries to keep pace with that demand. Where people live is anyone’s guess,” he said.
Supply of affordable rentals ‘falling for over a decade’
Mary Bennett from Anglicare’s Social Action and Research Centre said the drop in investment was concerning if it meant properties were leaving the long-term rental market and not being replaced by new supply.
“There has been a drop in the share of properties that changed hands being bought by investors,” she said.
“While this is an indicator of the level of investment in the long-term rental housing market, it may just reflect a drop in the number of investment properties changing hands.”
Ms Bennett also said it depended on how many investment properties entered the long-term or short-term rental market, and how much was being invested in building new housing supply.
“The supply of affordable rental housing has been falling for over a decade,” she said.
“If the supply of long-term rental properties in the private market falls, rents will continue to rise and we expect to see more Tasmanians turning to us for help as they also contend with other cost of living pressures.
“This is why it is so important that the government does not leave supply of affordable housing to the private rental market.”
Earlier this year the state government unveiled a $1.5 billion, 10-year housing plan to build 10,000 affordable homes.
On average, 1,000 new public housing homes would have to be built each year to keep the plan on track.
Market ‘slowing but not collapsing’
Overall, Tasmanian house sales have continued to trend down for the second consecutive quarter.
House sales fell 4.7 per cent on the previous quarter, and 9.5 per cent on the same period last year.
“We saw a white-hot market last year,” Mr Walsh said.
“So it’s only normal after that to have house prices stabilise and readjust to what we’re seeing now.”
Despite the falls, property sales for the June quarter were still slightly above the 10-year average of 1,739 properties.
Mr Walsh said there were no fears of a housing market collapse.
“Prices are definitely not collapsing. That’s a strong message out of the figures we have for the last quarter,” he said.
“We’re in a transitional period. Is the market going to slow from last year? Absolutely. Last year was one out of the books.”
The decision to rent or buy a home really comes down to someone’s personal situation.
But in the Bay Area, the rent vs. buy debate just got more interesting because of a certain piece of information.
That information is called the price-to-rent ratio. The difference as calculated by Moody’s Analytics is between the cost of renting and the cost of owning a home.
Plenty of people NBC Bay Area spoke to Wednesday said they’re ready to stop paying rent and become homeowners.
“And it’s really buying a house, but I’m not sure if it’s gonna be here, though because of the cost? Because of the cost, it’s a little too much,” said San Jose resident Jorge Ballez.
That’s the problem. The cost of home ownership in the Bay Area has gotten so high, Zillow economist Nicole Bachaud said that the ratio points to renting being the cheaper alternative.
“It’s around $3,200 a month to rent an apartment, versus it’s around $7,000 in just principal and interest, not including tax and insurance for a typical mortgage payment. So, that’s over double,” she said.
On the other hand, if someone buys a home, they will eventually own something.
“Especially here in the Bay Area, because the prices are so high and the value is still really good, you can sell that house later and go live almost anywhere else in the world that you wanna live,” said San Jose resident Laura Colunga.
Most people who NBC Bay Area spoke to Wednesday said they are renting at this time.
“I am renting now, with a few roommates, which is crazy, cause I live with two other people to be able to rent out here. That’s absurd, that’s why I want to buy a house,” said Dante Thomas of San Jose.