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Roommate Effect: Good News for Real Estate Investors

upbeat young female roommates having just successfully moved into their new flatAre you an investor or rental property owner who is worried about the future of your rentals? Turns out you shouldn’t be.

According to the Census Bureau, homeownership rates were reported at 63% at the end of 2015, which is a 20-year low for Americans and even dropped a point from last year-end report data. The good news for rental property owners is that vacancy rates are dropping as well, proving that the demand for rental units still exists. In fact, Zillow reported that the average rental rates are on the rise. Combine that with the fact that the US had over 700,000 new renters in 2015 alone. You can see a lucrative market for rental property owners.

3 Factors Contribute to the “Roommate Effect”

High debts, high rent rates, and low incomes have come together to create “the roommate effect.” Zillow also studied how the “roommate effect” will impact the rental market. Just like on popular sitcoms “The Golden Girls,” or “Friends,” or even “How I Met Your Mother,” adults today are doubling up in rental homes as a way to save money. In 2012, the number of American renters living with roommates or family members was over one-third of the adult population.

According to Stan Humphries, Chief Economist for, “All of these doubled-up households represent tremendous potential energy for the market. And when these compressed households begin to unwind and these millions of Americans do start to create their own households, demand will bounce back, possibly even causing household growth to outpace population growth.”

A Growing Market

Studies show that rental markets are stable and will be for some time so now is a good time for investing in real estate. As a leading company in Grand Rapids, Real Property Management Investment Solutions is here to help you while you grow your portfolio. Our overall goal as a company is to save property owners the time, money, and headaches often associated with rental properties. We offer specific solutions to and are experts on the local Grand Rapids area. As you continue to grow your portfolio, lean on our professional property managers to guide you along the way.

If you are interested in having your property managed by Real Property Management Investment Solutions, have more questions, or just want to speak to one of our team members, then contact us online or call us directly at 616-419-8880 today!

We are pledged to the letter and spirit of U.S. policy for the achievement of equal housing opportunity throughout the Nation. See Equal Housing Opportunity Statement for more information.