by Laura Williams, Center for Housing Policy
The National Association of Realtors recently released its 2012 Investment and Vacation Home Buyers Survey, and my own reaction was something along the lines of, “Finally!” Not that NAR was delayed in their release or anything, but that survey data is beginning to pick up some trends those of us in the foreclosure field had been suspecting for some time: individual investors are becoming a significant portion of existing home sales, with the idea of creating Mom and Pop rental options for single family homes.
As NAR’s chief economist was quoted in their release as saying, rents are rising and home prices are still low, making small-time rental management an appealing business opportunity for those who can afford it; and many can, it seems, as nearly half (49 percent) of investment buyers made all-cash purchases of their properties.
The good news is that these investors are helping to absorb the foreclosures that are hitting the market, preventing further dips in prices. The bad news is that rental management can be a difficult endeavor, particularly as buyers accumulate more properties (nearly half of investors said they planned to purchase another property within two years) or get farther from home (30 percent were more than 100 miles away).
The last round of stabilization funding (NSP3) included many plans pursuing scattered-site rental management. Most of those are on a much larger scale than these individual investors would ever dream of, but together they demonstrate a continued need to study this aspect of the rental market and create resources for landlords.
At the Center, we’ve already begun work in this area, and great resources are available from many other organizations. What other resources do you know of, or what resources do you think we still need?