Wednesday, July 8, 2009

Where the hell are all the people?

Here's another in long list of reasons Im not a rich man:

In as much as I think about these things I just assumed that when the bottom fell out of the housing market it would be a sweet time to be a landlord sitting on some rental housing property. It aint so , in fact it sucks to be a landlord right now as vacancies are high and rents are dropping.  

So where did everyone go?  I mean the logic follows that when someone gets kicked out of their foreclosed home with the adjustable rate jumbo mortgage they gotta live somewhere and rented apartments looked like a nice hedge against housing gloom.   

And I'll bet here's why I was wrong.   You know all those condos that got built the last ten years?  They didn't sell of course and now they're, you guessed it, rental units which means  overcapacity in the rental market must be extreme which sounds like a very bad thing to me because unless we start tearing down lots of condos that are only at 1/3 capacity there is going to be an excessive supply for a good long while which is going to depress new housing construction even if things turn around in the short term.  The list of things that can be classified as "lagging indicators" is getting longer by the day.

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