Over the weekend I received a post-card sized mailer from a local realtor. She was reaching out to residents in my general neighborhood. She has a retired couple interested in buying in the “neighborhood.”
Her “clients” want off street parking, an easy to maintain yard, located within walking distance to the center of Newport. Whether this couple exists is neither here nor there. The real estate market, as she points out, is smoking hot and if you’re thinking about selling she wants to hear from you. Pretty clever approach for stressed out buyers or realtors.
Which leads me to an article by demographer Joel Kotkin “Rising Rents Are Stressing Out Tenants and Heightening America’s Housing Crisis.” In thinking about this retired couple interested in spending more time “summering” in Newport, I wonder: Who is going to work at the grocery stores, restaurants, and beaches making their time in Newport bearable? I’m guessing it would be the younger generation, the Millennials, and not the baby boomers. But where will the Millennials be able to afford to live? They probably won’t be renting in Newport.
Nationally, “[r]ents as a percentage of income, according to Zillow, are now at a historic high of 29.1%, compared with the 25.8% rate that prevailed from 1985 to 2000,” writes Kotkin. “No surprise, then, that 58% of the 1,300 renters in the Hunt.com survey said they felt ‘stressed’ about their rent, or that many respondents said they couldn’t save for future purchases like homes.”
Like any expensive market, if the fundamentals slowly disappear then what’s holding it all together?
