We were discussing if rents would rise or fall when real-estate drops. My personal conclusion was that rents might rise in the short-term, as there is a shift of people to the now fewer apartments while some condominiums are for sale and empty. Also, inflation would keep driving up costs and therefore somewhat rents.
In the long-term, rents might stabilize or come down a little (in the hot markets anyways), as basically a lot of houses were built (due to speculation), and now people down-size (due to economic weakness). Here, the same number of people require a lower number of houses or bedrooms. An owner who got an ARM on a house might try to rent out a room now to make his resetting payments.
So far, rents seem rising. I live in a 1-bedroom in Irvine, and my rent will increase from $1465/mo a year ago to $1610. There has been some painting of the complex, but this has resulted in immaterial improvement.
I guess, I will call it quits now and will try to rent a room in a 2-bedroom or house. I am thinking of trying to find a home-owner, who got over his head, and now wants to rent out part of his his house. Any suggestions, other than checking Craigslist?
