Speaking as a landlord who does NOT use this software...
a better median house price would be to take the 10% most expensive (california and new york) and 10% least expensive houses out of the calculation and I'm sure you would find the average house is closer to $250K which would be far more affordable.
Next the idea that this is theft is not so, the lease is signed for 1 month, 6 months, or a year and if that is too expensive go live somewhere else cheaper. You can rent a hip apartment in the city (Grand Rapids) for $2000/mo or you can live 45 mins away (cedar springs/sand lake)and BUY a house with a $1500/mo payment here in west michigan.
Or even better you can rent a 2 bedroom apartment for $800 down the street from the house you could buy.
I do NOT lease to college students if I can help it (too much risk), but I've seen houses that are leased to them and they charge $500 to $600 a BEDROOM. This means that "single family" houses with 4 bedrooms 2 baths are being leased for $2400 / mo. I've seen $150,000 houses suddenly being rented for $2500/mo. (normally rent be %1 the value of the house or $1500/mo) That's a profit around $500-$1000 month after maintenance and management, get 10 of those and you're making $50,000 - $100,000 a year doing nothing. This rent price is fine for students but outrageous for families. (btw that's $1.5 million and 20% down and 5-6% interest. Management is normally 10% of rents if you pay someone else to do it for you.)
Now tell me, and be honest, would YOU want this? OF course you would! And, if you had it would you want to keep it? Of course you would!
Now, I said I don't use the software and I don't but I do look at the local market and what everyone else is charging and rents are going up. I try to keep my rental prices in line with the market and that usually tracks upwards faster than inflation.
Hopefully this gives you better idea of how this works.
I owned my house, cash. I sold it mostly because the area was changing and I didn't like the direction it was going. Now, I had a pretty awesome apartment in 2017 when I sold my house but the landlord turned into a drug addict, defaulted on their mortgage and the company that bought the house choose not to renew the lease.
So I moved into an apartment building, 50 units, because I wanted to live in the city. That landlord went to prison for wire fraud, the company that bought the building choose not to repair the laundry facilities, the garage door and then they got a coach roach infestation. I stopped paying my rent after talking to my lawyer because the landlord had violated their end of the lease. It went to court and I actually won, but they choose not to renew my lease. Didn't matter, after 6 weeks of coach roaches I already had a new lease signed at a new place.
I had actually been in the market for awhile for a new place at this point after dealing with the last real estate company. I found a very nice duplex and, the owner, was a very nice old man. I wasn't dealing with a massive realestate company, I was dealing with 1 guy who did all the work himself. I'd actually known him for awhile before I even knew he owned several properties. Well I looked at a few of his properties, picked one out that I loved and lived there. At the end of year 2 he told me he was selling the place. I was actually well aware of this, part of the reasons we became friends is that I lived in key west for a few years after college and he always wanted to retire to key west. I told him if he was ever going to sell that property I'd buy it. He didn't sell it to me, he sold all his properties in one go to *lets here it* a massive real estate company!
I was okay with the price hike as I was getting one hell of a deal on that property. $700/m for a 3 bedroom, off street parking, didn't have to pay for water. All I paid was electric, internet and rent.
So first year with this realestate company the rent goes from 700 to 1000. Whatever, that actually was market rate and I still wasn't paying for water so it was still kind of a deal. Next year they raise it to $1200/m with the justification being "inflation". Whatever, I make good money, It would cost more to move and the extra $200/m is less than a days wage to me, whatever. So then the end of the second year with this new company comes and they want to raise the rent to $1500/m. That was April of this year and I told them to go pound salt and I moved. That apartment is now listed for $900/m and still vacant. I looked at the history on my house that I sold, it was sold from one real estate company to another and, to my knowledge, noone has lived in it since I moved out of their 7 years ago.
I am not against people "investing" in real estate, I'm against people expecting it to be a money printer and taking the human element out of it. That realestate company has lost more money by trying to up my rent from 1200 to 1500 than they would have if they just kept it at 1200. Funny thing is I actually contacted them and would happily move back in for the $900/m they have it listed for but they refuse to rent to me. It is funny to give the property manager a call every couple weeks
Anyway, I'm getting off point. The housing market has increased in price faster than inflation and this is because of speculative investing. These aren't even what I would call real home sales, they're just investment companies trading assets back and fourth. This so called housing shortage is a lie, 1 in 10 homes in the US are vacant. There are more empty homes than there are homeless people in the united states. What has happened is that everyone has invested stupid amounts of money in realestate and now that demand at current pricing isn't there, the people left holding the bags don't want to drop them because for a few years realestate was a money printer. But that is the thing, we need a market correction. There was a fake realestate market for a very long time.
Now for me, I prefer renting. 1, I travel all over the US for work so I'd much rather have an apartment as basically an extended stay hotel room as a homebase than a house. I'm often out of town for months at a time so if I owned a house I'd have to hire a property manager to look after it anyway. On top of that, if you don't plan on staying in a home for atleast 7 years then you will likely end up losing money by buying a home. I plan on staying in Pittsburgh for 3 years more at most and even then, I spend, tops, 7-8 months a year here.
Keep in mind, I work in commercial construction so I deal with these scumbag realestate companies all over the country. My personal experience is hardly separated from my professional experience. I don't have a problem with *LANDLORDS* I have a problem with *speculative investment realestate companies* and the content of this article only reinforces that hatred.
