It’s no secret that today’s housing market is depressed in most major markets of the United States. The inability of homeowner’s to sell their homes for a price anywhere near their mortgage debt has created numerous and significant problems for our economy. Most homeowners are unable to afford the purchase of a new home because they are unable to dispose of their current home without taking a significant loss. This has led to foreclosure rates of more than three times the historical average, and has prevented many sellers from being able to take employment opportunities in other markets.

The result of tougher mortgage qualification has been an increase in the number of households opting to rent instead of buy their next residence. The rental market suffered greatly through the housing boom as more unqualified buyers were able to purchase homes. This led to vacancy rates that were at historic levels for much of the new century. Vacancy rates have dropped, and demand for rental housing is on the rise.

Traditionally, the rental market has been considered a place where those who can’t afford to buy go for housing. With the recent drop in home values, and the flexibility that renting provides, many have reconsidered this notion. Surprisingly, even those with luxury homes and high incomes are testing the rental market, as demand for luxury homes for sale has dropped significantly with the rest of the housing market.

Joyce Kelly owns Denver Rent a Home, a division of Platinum Real Estate Corp, in Denver, Colorado. Joyce leases and manages luxury homes for rent in Denver and the surrounding metro area. Joyce’s inventory includes homes from $1500 per month all the way up to an $8.7 million estate featured in this article in the Huffington Post. I asked her to explain the motivation of her clients in this most challenging of markets.

FRS– What are you seeing in the high end rental market; specifically how it relates to the slow housing market?

JK– We are seeing more and more property owners and tenants embracing the idea of leasing. Some of our tenants would like to test drive a neighborhood or house before committing to a purchase. Our typical customer owns a home they either don’t want to sell at a loss or can’t sell at all, and therefore leasing is the answer. The upside is high end property owners are not selling at current market values and opting to hold out for a better environment.

FRS– What have you seen with the value of high end homes and how is that is affecting the motivation of those sellers?

JK– We have high end home sellers that refuse to sell at a loss. They are typically looking to regain what equity they lost or hope to see pre 2007 values before putting their homes on the market for sale.

FRS– Who is your typical rental client?

JK—Our typical client is a high income executive with a family. They typically own 1 or 2 homes out of state and have excellent credit. Also we see high income earners that do not want to buy and understand the economic benefits of leasing a high end property. The prevailing mindset is the ability to control a high end home for a fraction of the cost.

FRS– Has your inventory increased in the last 12 months?

JK– Yes. Needs and desires keep changing. Once property owners see and understand that they have the option to lease their homes it only adds to the inventory. It gives them flexibility and peace of mind. Flexibility to downsize or take that new out of state job or move to take care of family members that need help. We see it all. Prospective tenants have more options and more to choose from than ever before.

FRS– How long does your typical rental stay on the market?

JK– If positioned and priced correctly, most of our homes rent within 60 days.

FRS—Why did you choose FreeRentalSite.com to help you market your rental homes?

JK—We were impressed with the quality of the site, and valued the experience of the management team in creating a rental marketplace in the past with Rentals.com. We also have clients that demand that we present their properties in the best possible light, and the picture presentation on Free Rental Site is unmatched.

Joyce and her business partner Michael Lapides practice what they preach. They rent a home from one of their clients in Castle Pines, CO, and enjoy the quality of a luxury home at a fraction of the price of purchasing one. If you have questions about finding or leasing a luxury home in the Denver Metro Area, you may contact Joyce and Michael by visiting DenverRentAHome.com. You can view their homes for rent on their site, or by visiting their profile on FreeRentalSite.com.

Contact

• David Borden
  Free Rental Site, LLC
  719-330-1649
  Email