A Nation of Sharecroppers, the "Rental Society" ~ Vanity

[ClearCase_guy]

Interesting points.

Under the current climate, with property taxes, difficulty in relocating, uncertain futures, and delicate margins in people's lifestyles (many live paycheck to paycheck now), of course renting all kinds of things makes some sense. You really want that flexibility.

But that's the point, eh?

The Powers That Be have constructed a world in which people shrug and say "Owning stuff just doesn't make sense today."

And that kind of seems like it's all part of the plan. Once upon a time, property was considered the foundation of liberty and independence. Now, it's kind of a hassle. And we look around and say "Where'd my liberty and independence go?"

[TomGuy]

Rent-to-Own has been around since at least the 1980s.

Before that, many families acquired items via Lay-away. Lay-away was common in many stores.

It was the advent of credit cards in the 1960s that sort of changed the way stores operated.

Lay-away sort of died out. It has made a return in recent years, however.

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Rent-to-Own does seem to appeal to a certain economic group of people. It is a convenient way to acquire some items.

I never cared for it because the ‘final’ price one would pay is 2 to 4 times higher than purchasing the same item elsewhere.

[kearnyirish2]

There is definitely a link between a population that has stopped breeding and the lack of a need for a house. As we’ve become akin to Okies following the crops around California 80 years ago, childless Americans know they can pick up and follow their jobs across the country. Here in NJ, that is exactly what many of our young people are doing.

[tbw2]

Dell Walmsley of Lifestyles Unlimited did a presentation on 4/30/15 talking about economic black swan events. His forecast for the real estate market is that everyone who has been foreclosed on in the past six years will be unable to buy for another 5-10 years. And surveys of the young 20-somethings show they were impacted by seeing friends, family and even parents evicted.

End result? Lots of renters and lots of young people who don’t want to do anything but rent.
He described the seismic shift in the myth of home ownership as a major change, and the flat economy is driving many investors with cash to invest in real estate. This is his explanation for why property values and rental rates are going up, though home ownership as a percentage of the population is going down.

I agree with his assessment that the home ownership rate is going to fall, though whether it drops from 70% ten years ago to 63% now to 50% like he predicts, I don’t know.

If that same mentality expands to other products, such as cars and appliances, I can imagine car leasing exploding. After all, many think they have to have a car payment, so why skip the equity and save each month?

Sites like Uber and AirBNB and ones for renting products are growing. It saves money, but I don’t know if we will see more than a few niche stores renting fancy handbags and jewelry. We are certainly seeing more growth in renting tools from Home Depot and video games.

Will the government make you rent everything but the clothes on your back? No, because too many people want to retain control over what truly matters, be it a personal computer, cell phone, heirloom jewelry, etc. And no one wants to rent underwear, toothbrushes, anything that their lives depend on (oxygen machines being a common exception).

In short: Real estate rentals will certainly grow in the aftermath of the Great Recession. Automobile rentals may or may not expand, product rentals depend on the product and queasiness renting it. Will people rent absolutely everything? No.

[greeneyes]

Interesting and true, but in addition, don’t forget the impact of quantitative easing “QE”. Every one of those actions devalued the dollar. Of course the price had to go up on real estate, just to stay even. In other words: inflation.

Once the glut is gone, the people who picked up some property at fire-sale prices will be in a pretty good financial position, especially if it’s free and clear, and they can pay the property tax.

As to renting or leasing cars, I’ve been doing that for quite a while. I am currently driving a 1996 minivan with over 200,000 miles. Most of the time we are not even 5 miles from home.

However, if we take a trip of more than 300 miles, we consider renting a car. The only reason I’m driving the 1996 car, is because the 1994 Dodge Colt with 250,000 miles died, and no one was able to get it to go again.

No payments, small ins. cost, and small personal property cost, had to recently have a little muffler work done. All else is still going strong. Bought it in 2004 for $6000. Hope I don’t have to buy another, cause it was the last year for this particular model. LOL