Rental Home Demand Up Now!

If there is a common thread in the local real estate market and that of our nation, it is the fact that rental homes are becoming more popular than in the past. Census figures show that the homeownership rate fell to 66.9 percent in the third quarter of 2010, which is not surprising given the troubled economy. This shift can be accounted for in a number of ways including foreclosures, job losses and tighter credit standards.

The Village has always had a significant portion of homes utilized as second residences and rentals. Many of these homes were purchased as investments and produce rental income for their owners as well as tax write-offs. Routinely, a home is purchased by a non-resident who then employs a local real estate firm to find a steady stream of nightly renters. In return for rent collected, these firms pay the homeowner the rent minus cleaning fees, commissions and maintenance.

Increasingly, absentee homeowners are now looking to real estate firms to help them find long-term renters who intend to move in for some longer period of time. Long-term renters have a tendency to take better care of the home since they intend to live there for a number of months or years. RE/MAX has experienced exponential growth in its long-term rental business over the past 18 months and the growth continues to remain strong. “A year and a half ago, we only had about 15 long-term rentals,” said Jeff Hollansworth , owner of RE/MAX. “We are now actively managing over 100 long-term rentals and we have the unusual problem of having more potential renters than we have homes available to rent.”

Over the past year, RE/MAX has seen a number of people purchase new or existing homes and immediately place them on its rental program. “In most cases, these buyers have every intention of moving here in the future,” said Hollansworth, “they just have something keeping them from making the move right now. In many cases, they are taking advantage of home prices that are at the lowest level in several years, recognizing that they will need to rent the home until such time they can become more permanent Village residents. The other situation happening,” said Hollansworth, “is that some homes that have been for sale for an extended period of time, end up as rentals as a means of waiting out the market.”

Gary Strong oversees the long-term home rental program at RE/MAX and he estimates there are over 1,000 Village homes currently under property management agreements either in a short term or long term capacity. “Many of our customers choose RE/MAX to manage their homes because we’ve been successful obtaining renters. No one wants to have their house just sitting empty. Our websites and advertising have helped considerably in growing our property management business.”

Long term rental rates on Village homes are attractive when compared to the cost of a mortgage, insurance and up-keep expenses. The sheer number of rentals has traditionally kept rental rates artificially low and property owners seem content in recouping the majority of their expenses while recognizing there are tax advantages. RE/MAX has earned a reputation for carefully handling its homeowners and renters. “Customer service is the key,” said Strong. “We couldn’t grow our property management business by six-fold without keeping our customers happy.”