Buy or rent as rents rise and house prices fall?

By Edward Harrison On Mar 12, 2012

This is a good segment from CNBC on the dichotomy we see in the housing market of still falling house prices and rising rents. Is the rise in rents a foreshadowing of house prices stabilising? Take a look.

Edward Harrison 7783 posts 575 comments

Edward Harrison is a senior Editor at Bloomberg. He is also the founder of Credit Writedowns newsletter, a former career diplomat, investment banker and technology executive with over twenty five years of business experience. He speaks six languages and reads another five, skills he uses to provide a more global perspective. Edward holds an MBA in Finance from Columbia University and a BA in Economics from Dartmouth College.

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1 Comment

David Lazarus says 12 years ago

This is typical of bubble mentality. If rents are rising it is because of shortage of supply, as real estate is stuck in foreclosure. The long term problem is that it could harm the willingness of potential buyers to actually enter the market. Rising rents harms their ability to save for deposits and so have stability in the housing market. These people could be permanently renting and that has political impacts in that they will not be gaining from the growth in the economy and should there be any further headwinds they will become a worry for politicians. In the thirties they appreciated that people without a stake in society are likely to be revolutionary and if you turn a nation of home owners into poor renters then you have the foundations of the next revolution.

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