Categorized | Residential

Rentals May Lead to Housing Recovery

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As real estate executives and government officials alike try to fix the crumbling residential housing market, analysts now believe that rental properties may be the key to recovery. The United States government has attempted to improve the market through a myriad of solutions, including keeping mortgage rate levels at their lowest ever. However, none of the solutions have had produced more than a temporary slight bump in sales.

Analysts believe that the actions taken to resolve the current housing crisis have not been sufficient enough to truly be beneficial in the grand scheme of things. Rather, they believe that the government is focusing its attention on the wrong areas. Many analysts are calling for the government to take measures at reducing the overall supply in the residential real estate market by offering tax write-offs to investors that buy empty homes with intentions of renting them to others.

The tax write-off would make empty residential properties much more attractive, and would likely increase sales. As such, the number of homes for sale on the market would decrease, and the prices of those available would increase due to limited supply. Furthermore, overall home values would likely increase, potentially reducing the number of underwater mortgages.

There are roughly one million vacant houses currently for sale nationwide. If the government took measures to make such homes attractive to investors, the overall housing market could benefit greatly. Currently, investors receive tax write-offs based on depreciation over a twenty-eight year period. The suggested measure would make such a write-off immediate instead of gradual, and won’t be a major burned to taxpayers.

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About Ella Jourgeson

Ella was recently an intern who checked all the articles for grammatical and spelling errors. She is now an all purpose writer filling in wherever we need help.

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