NEW YORK (CNN) – More homeowners are deciding to hold on to their old homes and become landlords, that’s because mortgage rates are low and rent is high.
Looking to buy a new home? Maybe you don’t have to sell the old one first.
More Americans are holding onto their former homes and renting them out, thanks to low mortgage rates and soaring rents.
19 percent of homeowners either purchased or refinanced homes between 2011 and 2013, when mortgage rates hit all time lows.
Rates are still historically low averaging 4.2% last week for the 30-year fixed.
At the same time, rents have risen about 20-percent nationwide since mid-2006.
Of course, being a landlord isn’t for everyone, you’ve got to make repairs, deal with tenants, and cover expenses even if the property is vacant. But rental income can mean enough money for many homeowners to cover their mortgage and taxes on the house they actually do live in.
Still, this trend is one factor holding back the housing recovery.
Every home that becomes a rental property is one less that goes on the market. Low inventory has been a real problem, particularly in hot housing markets where few homes are up for sale and low inventory can drive up prices and hurt sales growth.