The economy is driving many homeowners to rent out their homes while they wait for the market to recover.
From CNBC: “I had my condo on the market for three months and I didn’t have any bites,” says Molly Smith, a public relations executive in Newburyport, Massachusetts. “I realized if I was going to sell it, I’d take a big loss.”
So the 29-year-old Smith, who wanted a shorter commute to her job, decided to rent out her house and move into a rental herself.
People are deciding to rent out while waiting for home prices to rise. But how long do they have to wait, or how long can they last without selling ? The head of the Federal Deposit Insurance Corp. Sheila Bair said on Tuesday that a recovery in the U.S. housing sector could be as much as two years away.
From Reuters: “It’s going to be a slog. It’ll require hard work on the part of industry and government,” FDIC Chairman…said in remarks prepared for a gathering of the National Association of Realtors. “And it’s likely to take another year or two for the market to recover.”
Bair said housing prices had fallen over 30% since a peak in early 2006 and some indexes suggest that home prices could fall further before bottoming out this year or early next year.