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That relationship - when purchase prices go up rents go down and vice versa has always seemed odd to me. When you think about it, it makes sense but you'd thi
by hackeraccount 6y ago
That relationship - when purchase prices go up rents go down and vice versa has always seemed odd to me. When you think about it, it makes sense but you'd think most people wouldn't have the flexibility to move between renting and owning.
- wombat-man 6y agoyeah it probably won't swing back as fast if rates go back up. A lot of us who were waiting around for a reason to buy suddenly got a reason to make a move. Anyone who bought a place is probably not going back to renting soon/ever.
- rossdavidh 6y agoMostly I agree with you but you might, if owning, choose to rent out your existing place and move somewhere cheaper? Also, here in Austin, TX I know people who rent, who own properties that they rent out to others. It seems odd to me.
- pessimizer 6y agoYou rent places in order to live in them. Owning property is always investment (if you're rational, and real estate middlemen will encourage you not to be.) Owning your own place, if not for the massive state subsidy, is basically renting from yourself for the price you would have paid someone else + maintenance. Austin is a great example of a place where you may have bought a house in a really cool neighborhood, which 20 years later is in the middle of a shit yuppie neighborhood. You can rent that house to the shit yuppie who will be happiest there (and is loaded and willing to pay a premium) and rent in a cool neighborhood, especially if rents are low. You might not have to work at all.
- PragmaticPulp 6y agoInvestors buy properties and rent them out when they have access to cheap loans. This increases demand on house purchases, but increases supply of rentals. Home prices go up, rental prices go down.
- csomar 6y agoIt would only seem odd if the market was rational. As it is, the market is driven by greed, fear, money laundering, etc...