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Rental market flooded

READ MORE: Rental market flooded
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You may have noticed a few more places for rent around town these days. If you're looking for a place, that can be a good thing, but not everyone is happy about the vacancies. They've tried selling their homes on their own, they've tried selling through real estate agents, and now it seems more home owners have turned to renting. Jim Felds, mortgage specialist explained, “Because they are unable to sell their homes for the price that they need to, many of them are being rented.” Rich Dolinger and Shawna Kenney moved here from Los Angeles so they could afford a place to live while Shawna went to school. Rich Dolinger, a frustrated home owner said, “We had a great plan, theoretically. From Los Angeles, we were thinking we can't afford to buy property in L.A., so let's move to Wilmington where houses were really cheap at the time.” Now that she's graduated, the couple is trying to sell, but with no serious buyers in the six months their home has been for sale, Dolinger and Kenny decided to try and rent it on Craigslist. Shawna Kenney said, “We would love to sell it immediately and move back to Los Angeles, but since that doesn't look like a reality at this point we've had to come up with sort of plan b or plan c.” With more properties available for rent this year than in years past experience landlords saying they're having more difficulty filling their homes. Patrick Kenipp, an experienced landlord said, “Well there's been a few houses in the neighborhood that have been on the market for the past year, and recently I'm noticing ‘For Rent’ signs in front of those houses and the ‘For Sale’ signs are gone.” Jim Felds said two main factors contribute to more rentals in our area… the low income housing market because of Section 8 and the reduction in vouchers and first-time home buyer money has become more available. So those signs won't disappear any time soon. We might see for sale signs disappear faster than the rental signs. The government is trying to encourage people to buy homes with a $7,500 tax rebate for all new homeowners.

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$7,500 federal loan

The last sentence of the article is misleading; it is not a $7,500 tax credit. It is a $7,500 federal loan that must be paid back. And it has been around since this summer.

Risk capital is RISK capital

Selling the home in the short-term was evidently a part of their game plan. Accordingly, their investment had a fair degree of risk associated with it. What WAS four years ago in our housing market IS no more. Things change. They'd be wise to do two things: Never again view their primary residence as "an investment" when mobility is a key issue, and drop the price to facilitate a sale now. They DON'T want to be long-distance landlords.

Pricing...

I took the time to look up these fine folks' property, using public records. Based on the price they paid, and the price they are now asking, it looks like they expect a prospective buyer to give them 11.5% annual appreciation on the house, or about $60,000 more than they paid 4 years ago. Hard for me to feel any sympathy, when the national historical average is what, 4%? And Wilmington's GDP grows at about 6%? Looks to me like they just want to cash in on that bubble that's deflating.

Hey Greenie...

Your Realtor comments are most impressive.. However lest you forget, Wilmington is still a SERVICE town with some wealthy people here. It is NOT a town with 6 figure income jobs available all over the county.. The meduian income of the New Hanover COunty resident is $37,000 ... which 'aint' very much.... Getting the prices BACK to normal, where they were seven to eight years ago will again, revitalize our LOCAL conomy. Attempting to get individuals to price their rentals 20% or more above mortgage will only prolong the suffering of our area marketplace. I would rather sell two homes in the next few months at $150k each than to sell none $ 225l each... Sounds like you've been floating in that fantasy bubble of dollars for way too long and your ego got a little swollen alon the way... There are hundreds of homes that are owned out right in Wilmington, and I have watched those rentals (same owners/landlords) go from $450 per month to (yes the same house with no improvements off of Oleander) to $1200 per month.. it is people like you and these landlords who havd a swollen greed and have inflated prices so much that the people who actually work in Wilmingtonm cannot live here. This included several employees of both county and city law enforcement, rescue squad, hotels, hospital, fire department, etc..etc..etc.. And don't come back with I am uninformed and don't know what I am talking about.. Statistics don't lie and when our area gets back to a "fair", I said FAIR pricing, and not so over inflated, THEN.. and Only then.. will out market recover....

The market dictates rents

It's not about a landlord's greed, it's about supply and demand. If a landlord asks $1200 and gets $1200, don't expect him to lower it. If he asks $1200 and can't find any renters, he may find some at $1000....or $800. The reason that rents have gone up is because there was no shortage of renters willing to pay what was asked. That's now rolling off as the economy contracts, and the rentals that are sitting empty will see their rents decrease or they will continue to sit there empty. The free market works wonders, if you let it. To use that line from the Godfather, "It's nothing personal, it's business." If someone is going to pay me $1200, I'm not going to give it to you for $800 because I'm a nice guy and you need a place to live.

cause and effect

And until the prices go back down, there will be an abundance of empty rental homes.... I like to call it, cause and effect..

rentals

Rentals are going empty, and a rental price war is inevitable - further exacerbating the foreclosure rate - since landlords will be taking less rent in than the mortgage demands. Again, I ask why the county planners keep allowing more and more homes to be built while a larger percentage of New Hanover county homes go unsold, unoccupied, foreclosed, or bank owned. They hold the power to grant or deny permits. Construction workers, I realize this is your source of income, but perhaps you could shift your focus to renovations. There are lots of properties that need sprucing up. It seems that in this economy someone, somewhere, is eventually left holding the bag. Build less, increase demand, preserve the ecology that draws people here.