Real Estate Market - Renters Benefit From High Mortgage Rates

The market conditions have changed so much in the last couple of years that one no longer wants to buy a home but prefers to rent it. Renting a home is turning out to be a wiser financial decision when compared to buying it. This is a marked deviation from the trend a couple of years ago, when the consumer preferred to buy properties as then the money paid would help build home equity.
In spite of the steady inflation in domestic rent rates, consumers are finding it cheaper to rent homes rather than to purchase one out right. Rent is turning out to be in some cases up to 50% cheaper than monthly mortgage rates.
This can be partly attributed to the continuing deflation of home prices in many parts of the country. People who bought homes seem to have no recourse but to sell. So what if people want to sell, where lies the problem? The home owners would like to sell at a price corresponding to the value of their homes when they bought it so that they can cover the remaining mortgage payments. It is just not possible to get those prices in the current scenario. No one is willing tp pay more than the current property value.
Many people who can easily get mortgage to but their own homes are deferring purchase in favor of renting homes, because they feel that they are not getting value for their money and that they can get similar if not bigger homes for rent, for the same amount of money.
This clear shift in favor of renting homes has led the experts to say that the market is no more for the buyers or sellers, it has become a renter's market.
Another fact that deters new buyers is that the property prices have still not hit rock bottom. They are expected to fall more. No one would like to buy a new home and then realize that within a couple of months the value of their home has fallen. In fact they think it would be wiser to wait it out till the priced level out, so that they can get better bargains. To add to this factor is the impending hurricane season. People cannot forget in a hurry the destruction that was caused to homes in the two preceding years. In fact many of those who lost their homes and properties have still not recovered, especially those who were not insured.
Many of the areas seem to have a shortage of properties available for rent. Many homeowners are thus tempted to hold on to their properties and seem to sense the added value. They would also like to wait for the market to level out and hope to regain some value. Many of these homeowners will automatically turn towards renting their properties in order to meet their mortgage payments. With increasing number of renters it is a good proposition. Many homes which have been put up for sale are available for rent too. Those who take up such establishments are aware that their homes will have to be on display each time a potential buyer comes by. In spite of this inconvenience people think that it is still wiser to rent them.
Many investors had bought homes to make a quick buck, even such owners think it is a better option to rent out their properties rather than sell them in this market. Many are forced to opt for renting their homes out, as they see no other recourse. They need the rent to help them pay the mortgage payments every month. Since they are not able to sell their properties at desired costs, they are prepared to rent them out, even at a loss to able to recover something.
The situation is so bad that many landlords are forced to offer lower rents. The reasoning is that immediate rent though low is a better option than, delayed rent, which may or may not be what they desire. Considering the current scenario renting a property seems to be the safest bet.
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