‘Accidental Landlords’ Popping Up Nationwide [AUDIO]
There's an interesting trend occurring among homeowners, primarily those underwater, across New Jersey and the United States. The trend is yet another part of the long healing process from the boom-and-bust cycle.
Realtors call them, "Accidental Landlords," folks who still owe more than their homes are worth, so they can't afford to sell their original property when they move elsewhere. Instead, that original property is rented out until the market improves.
Many times, these double-owners are forced to move due to a family matter or job change.
"It's hard to put a number on it, but clearly it's a trend that is going on," said Walter Molony with the National Association of Realtors, who noted that several members mentioned the issue during recent mid-year meetings in Washington, D.C.
Fortunately for accidental landlords, the rental picture has been very pleasant.
"It's making it much easier for people to rent properties as single-family homes if they need to," Molony explained.
Some vacancy rates have been as low as two percent in the Northeast; anything below five percent is considered a landlord's market.
Molony said the original properties will eventually be sold when home values reach a point that paints a brighter picture for the owners. Nearly two million homeowners who were underwater last year are now whole with their mortgages. An estimated two million additional owners will turn positive this year.