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Are Renters Flocking to Buy Homes? [VIDEO]

Small shifts in data tend to quickly make headlines and dominate conversations. Most recently, it’s the uptick in single-family home sales creating some news about apartment renters leaving to buy homes. But it’s not a big spike – and even if it was, that wouldn’t necessarily be a bad thing for the U.S. apartment industry. Greg Willett and Jay Parsons from MPF Research explain why in this video edition of Apartment Market Dynamics.

[video:http://www.youtube.com/watch?v=CD7QPR5O1KY&list=UUyoXp1Vnx1d1sw1ZzzT2AJw&index=2&feature=plcp 433x300]

 

Michael Cunningham is the Managing Editor for Property Management Insider.

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As a real estate professional, I am seeing a resurgence is the sales of small "starter" homes and older existing homes and the buyers are these younger returning vets. These young soldiers who are coming back from deployments have oftentimes been off in Iraq and Afghanistan (many having served 2-3 deployments) and have been accumulating enough money to buy outright or obtain VA loans with considerable down payments. I think this is what is driving some of these small increases in some markets for house sales. There are also a tremendous number of renters (they're the ones vacating these houses and those evicted from foreclosurers) who are seeking apartment housing.

For our apartment communities, the rents are higher than a mortgage payment in many cases and we will always lose renters to the buying market especially in the spring and summer. These communities have seen a turnover rate of 50% or higher and are just now happily enjoying trunover rates of 37-42% (which isn't anything to brag about really.)

  Mindy Sharp

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