A person is not just imagining things, the cost of rent is on the rise. It seems that rent is very high these days. There are some reasons why the cost of renting is so high. The cost of rent is rising faster than wages. On average a person needs to make almost $23 an hour to afford a two-bedroom rental. Even people with the medium income struggle to afford their rent each month.
Great Recession Lead to Rental Market Trouble
When the recess began in 2007 the prices of houses feel. This caused chaos for both homeowners and renters. Foreclosure rates were high and many homeowners were turned into renters. Many millennials had to rent instead of purchasing their first home. New construction all but stopped. There was a demand for rental properties which lead to an increase in the price. Rental units are not being built as fast as the demand is for these units. Six million possible homeowners are still renting. The baby boomer generation is looking to retire and sell their homes. They will enter the rental market. People with lower incomes are not being approved for a home mortgage and the only other option is to rent. If a person has to rent a place at a high price they are not able to save for a home and this leads to further trouble. The demand for rental units is still high allowing the price to be high.
Costs of Building Homes
There has been an increase in building for luxury apartment buildings. There are not too many homes or apartments being built for people with a medium income. There is also a shorted of skilled construction workers all over the country which is slowing down the building process. The prices of materials such as lumber have increase as well as steel and aluminum. Since it is more expensive to build new units the cost for apartments is going to rise to make up the difference.
Lawmakers Did Not Fix the Problems
The government has not yet fixed the problem to make and improve programs to make homeownership affordable for the average person. The Department of Housing and Urban Development has not yet addressed these problems. Zoning restriction laws also prevent new apartment buildings from being constructed. States can address this problem as well. Oregon was the first state to develop a rent control law capping how much rent can increase each year and the law makes it harder for the landlord to evict people. New York is also looking to pass a similar law. Three-quarters of the population is willing to vote for a president that will fix the housing crisis and will help people be able to afford home once again.
Rent is expensive but if a person cannot afford to purchase a home they may not have another option. Due to the high demand for rental properties, there is an increase in the prices of rent and the percentage of their income people need to pay to live.