The Current Challenge For Residential Rentals

By Charlie Basil

The current troubled economic climate has created new problems for landlords. Prior to the downturn, it was widely predicted that a significant recession would be led by the residential real estate industry. Corollary forecasts predicted a boom for multi-family real estate and other leased housing models as a result. In actuality, something much different has happened. Vacancies rates are exploding and rental rates are drastically declining. The reason for this is quite simple. It is a function of supply and demand; and frightened competition.

SUPPLY

Supply of "for rent" housing stock has increased in many primary markets for several reasons. Ranked high among these reasons are the following:

During the last housing boom, many speculative properties were constructed with the growing pool of first-time home buyers in mind. When the "bubble" burst, the developers realigned financial strategies and converted unsold units to "for rent" housing stock.

Many people who own real estate have experienced a change in their financial condition, and can no longer afford their mortgages. Due to the recessed market, they have elected to rent their property instead of selling it.

In higher priced markets, populations are retreating to lower cost options which may include moving outside of the submarket, relocating outside of the metropolitan area or moving within the submarket to a lower cost housing product.

DEMAND

"For rent" housing demand has declined and tenant preferences have shifted. There are several reasons for this shift in demand. Among those reasons are the following:

California is experiencing a net job loss, which reduces the capital available for housing in the marketplace. Additionally, workers and families are moving to lower cost metropolitan markets in search of income and reduced expenses.

Americans have generally become more conservative in spending habits. Thus, tenants have retreated to value-oriented rentals as opposed to higher cost luxury product. In our coastal markets, it had been popular for Landlords to upgrade rental real estate to harness the demand for luxury product and amplify return on investment. Such luxury product is no longer highly desired and therefore, remains vacant or must be reduced in price in order to be competitive with more value-focused rentals. As luxury rents reduce, they create downward pressure on value-oriented rentals as higher quality products enter lower price ranges.

Household consolidation has curbed demand for rentals as Americans have chosen to reduce housing costs by entering into roommate partnerships. For example, two individuals who once lived in separate one-bedroom units have chosen to collectively rent a two-bedroom unit, occupying one unit, but vacating two units.

As supply has expanded and demand has constricted, pricing and terms have moved in favor of the tenant population. Landlords are now experiencing longer vacancy periods and are receiving lower rents. Therefore, landlords are taking drastic measures to compete for the business of a rental pool with seemingly limitless options. Terms like reduced security deposits, no credit check, multiple months of free rent and reduced rental rates are now prevalent in the marketplace. This is referred to as "frightened competition" and has adverse effects on the overall marketplace. It creates a downward spiral as property owners vie to achieve immediate occupancy by offering terms that are increasingly positive for renters and negative for landlords.

Charlie Basil is the Director, Operations and Bliss for the RENT guru, a turnkey residential leasing service that provides landlords with a quick, efficient and cost-effective way to fill vacant properties. The cornerstone of the RENT guru is the signature concierge service which includes:

A determined sales team to manage and execute property tours and open houses during peak traffic hours. -Designer advertisements on craigslist.org, westsiderentals.com and other listing services featuring high quality photos taken by a RENT guru.-Promotional campaigns via email, social media (i.e. Twitter and Facebook) and other information-sharing platforms to quickly spread the word about your property.-SMS (text message) and email information on-site that immediately delivers property details directly to mobile phones.-Comprehensive tenant qualification (credit, income and background checks) and execution of all contracts with delivery of finalized tenant package for your files.-Ongoing customized reports containing market feedback specific to your property

Charlie also is President, The Fresh Basil, Inc. marketing consultancy.
Article Source: http://EzineArticles.com/?expert=Charlie_Basil

Modern Farmhouse Design

By James Crisp

There is no absolute prototype for a farmhouse, but most of us can recognize one when we see it. By definition the originals were located on farms and were integral to the life and work of those farm families who lived there.

Depending on when and where those homes were built, they could be made of stone, brick, shingles or clapboard. Most farmhouses had porches since there was no air conditioning and many farm and family chores were undertaken there. The porch roof provided shelter from the sun and rain yet allowed the cool breezes to flow through and help make those steamy summers tolerable.

The center of family life in the farmhouse was the kitchen. Meals were prepared and often eaten there as well as home pickling and canning for the long winters (in the North). In the older farmhouses, a cooking fireplace was essential. Additional fireplaces were used to heat as many rooms as possible.

I live in an old farmhouse originally built around 1790 and then added onto in the 1800s and more recently added onto by my family. I have come to appreciate the simple detailing the wide board floors and beautiful fireplaces.

When designing a modern farmhouse, porches, wide board floors and beautiful fireplaces are welcome. The floor plan can be center hall, side hall or a variation of the two. Gathering places within the home are as important today as they were 200 years ago. Modern farmhouses include big bright kitchens to accommodate the inevitable influx of friends and family. These days many families spend most of their time in the kitchen cooking, eating, talking, studying and just visiting. Energy efficiency is important, with some farm houses using geothermal heating and cooling and solar panels on the barns.

We are lucky to inherit the traditions of our founding families including their most treasured possession, the farmhouse.

http://www.crisparchitects.com/ James M. Crisp, AIA is an architect working in New York, Connecticut and Massachusetts. He is the author with Sandee Mahoney of On The Porch, Creating Your Place to Watch the World Go By.
Article Source: http://EzineArticles.com/?expert=James_Crisp