Rental homes became more desirable as mortgage loans became more difficult to obtain. The restrictions imposed by banks and other lending institutions in 2000 resulted in more people needing to rent rather than buy. This led to a sharp increase in rental prices.
As anyone who listens to or reads the news knows, the country is beginning to recover from the recession that caused financial problems in all areas of the economy. One area that was deeply depressed was the real estate market. Many people faced the glum reality of owning a home that was worth less money than what they still owed on the mortgage. Foreclosures resulted partly due to the bankers’ lax awarding of mortgages to those who could not afford the homes they were purchasing.
For some time people who lost their homes to foreclosure had to rent homes and apartments to live in. The reversal of that situation is at hand and a recovery is taking place in many states. Banks went from being too lenient in lending practices to being quite restrictive now. Credit is readily available to those with spotless credit ratings. It is harder to get and more expensive when those with spotty credit histories can get it.
Cities with a population above 50,000 show an increase in occupation of rental units. Smaller cities such as Paragould are now following that trend. Paragould experienced a 7.1 percent increase in renters over the last decade. In 2000, it was 35.8 percent and by the end of 2010, it had risen to 42.9 percent. Various socioeconomic factors are involved in creating this situation.
U.S. census data reveals a median rent of $443 in 2000 and an increase to $577 by 2010. That is an increase of $134. , the gross median rent price in Paragould rose by $134 last decade, from $443 in 2000 to $577 in 2010.
Bad credit is the main obstacle to being approved for a mortgage. Of course, it is understandable that someone with a foreclosure in their credit history is not going to be called a good risk. Since they must live someplace, they turn to rental units. Population growth in the town is another contributing factor. Four-thousand new citizens have moved to Paragould.
It is partially due to work being available in factories. Some of those choosing rentals are simply tired of the maintenance and responsibilities connected to homeownership. As empty nesters require less space, they may also prefer to rent.