The turmoil in the housing market over the past few years has scared a lot of people away from homeownership. That means many people who can afford to buy are now renting. With so much demand for apartments, rents are once again on the rise. And in places like New York City, they're near record highs.
A few weeks ago Lauren Weitz got her first apartment in the city. Every night when she gets home from the office, she upholds a New York City tradition.
Meet Willow Tufano, age 14: Lady Gaga fan, animal lover, landlord.
In 2005, when Willow was 7, the housing market was booming. Home prices in some Florida neighborhoods nearly doubled from one month to the next. Her family moved into a big house; her mom became a real estate agent.
But as Willow moved from childhood to adolescence, the market turned, and the neighborhood emptied out. "Everyone is getting foreclosed on here," she says.
Joe and Carrie were out of work and had run out of money. They had been living in a motel room with their two young daughters. The Crossroads House homeless shelter has helped them get back on track.
JOE: I was teaching in Maine part-time and suddenly there was no more work. So I said to my wife “let’s see what New Hampshire has - substitute teaching and stuff like that." We lost our place where we were living and we were living in a motel.
Many experts say reducing mortgage principal can help troubled homeowners stay in their homes. But two of the nation's largest mortgage holders, Fannie Mae and Freddie Mac, have not signed on to the idea.
Despite some green shoots in the economy, the housing sector remains weak. With 11 million Americans still underwater on their mortgages, some housing experts believe it's time for more dramatic solutions.
The idea of reducing the principal on the loans of underwater homeowners used to be a fringe concept, embraced by a few outliers. Today, many policymakers believe principal reduction is necessary to keep some troubled homeowners afloat.
But so far, the nation's biggest mortgage holders, Fannie Mae and Freddie Mac, haven't embraced the idea.
Not everyone wants to buy a mold-infested foreclosure, but Dan Grohs does.
He and his Realtor are walking through a three-bedroom house in Minneapolis. The copper pipes have been stolen by vandals and the heat doesn't work, but Grohs recently bid on the house — and he sees potential.
"It's got a nice flow to it," Grohs says as he moves through the home. "You walk in — living room, dining room, kitchen. Good spacious rooms."
Luz Escamilla's bedroom walls are stained with the blood of bedbugs. She says she doesn't want to bleach them until reps from CW Capital, her landlord, pay an in-person visit to her Maryland home.
Credit Mario Lugay
Pedro Jimenez and three of his kids, in the living room of their East Oakland, Calif., apartment. JPMorgan Chase hasn't hired a management company to fix the shattered window panes or make other repairs.
Credit Mario Lugay
David Jimenez, 7, patches up holes in his East Oakland, Calif., apartment. The bottom sticky note says, "I love you Papi."
Across the country, big banks and other large investors are buying up tens of thousands of foreclosed rental properties. They're not always model landlords, according to tenants and regulators. Some banks are failing to follow local and state housing codes, leaving tenants to live in squalor — without even a number to call in the most dire situations.
An agreement involving national banks and state attorneys general penalizes banks for improper mortgage and foreclosure practices and offers relief for homeowners. Yet some say it leaves far too many without recourse. Meanwhile, the Obama administration has another plan to offer further help. We’ll see how these initiatives might affect New Hampshire.
Home sales in New Hampshire remained about even with last year. About 200 more homes changed hands in 2011 than in 2010. Prices continued to slide. The median sales price was about $201,000, or about 6 percent less than the year before. The latest numbers from the New Hampshire Association of Realtors leave it unclear where the market is headed. There are some signs of improvement. Between November and December, prices held steady and at least from one month to the next, the number of homes sold rose by about 8 percent.
A New Hampshire developer plans to renovate two mostly-abandoned apartment buildings in Franklin and turn them into affordable housing for working class families. The company, New England Family Housing, plans to buy the 30-unit building for $615,000.