Numbers released by Moody's Analytics say people are deciding on renting homes instead of buying them, and it looks like it's due to the obvious income issues (per capita income is growing incredibly slow) and all things related to the foreclosure crisis. About a third of people surveyed aren't taking the plunge to purchase a home because of the downpayment money required. People are also weary of the stability of the market in the future. So instead, they are renting.
The demand for renting instead of purchasing homes is also attributed to the large number of the younger demographic choosing to rent - the Census Bureau says that 77 percent of those under 24, and 65 percent of the 25-29 age group are renting.
Additionally, new construction of multi-unit homes is growing faster than single family units, and even lenders like Fannie Mac are turning bank-owned properties into rentals.
Average rental rates in Los Angeles have been up since December 2011, and the median price of renting a two bedroom home in Echo Park is $2,019 according to Rentbits.com.