Several readers are interested in post housing bubble rents. "What will happen to rental rates in a real-estate bust. Will rents go up as more people decide to rent rather than buy, or will they go down as the number of vacant homes balloons and investors resort to renting to get some sort of return?"

A reply, "A record number of vacant homes in the USA (still increasing due to the final death throes of the HB construction bubble blowout) will put downward pressure on both rents and for-sale prices over the next 10-20 years, as the housing market adjusts to fundamental economic reality. The only wildcard is whether BB will turn into Heliben…"

Another, "If it were only this simple we could all be rich. Rents track inflation and not housing prices? Well that depends. As home prices crash why should rents follow if they haven’t been following in the past? Think musical chairs. The music stops everyone sits down. Except this time the music doesn’t ever start up again. Household formation is going to overwhelm any glut of available units in short order."

"Now locally this will be a very messy process. Luxury $4000/mo rents in Orange County will crater to $2500. Rents will eventually go way up even as prices come way down, there’s no contradiction in that."

And to that, "For as long as I can remember and I’ve been in the business for quite sometime in my area (Los Angeles) there has been at least a 15 yr shortage in Ca. based on permits taken out for rental housing. With that being said during the last downturn there was an average of 30% drop in rents. I don’t see a significant or any increase in rents in the near or present future."

From LA. "I can tell you rents are way up here in LA. Simple fact is, there are jobs here, and not enough housing. Also, all these so-called investors who’ve been bidding up tear down 1920’s era 6- and 8- unit buildings for 1.3 million CANNOT rent the units out for less than the very high rents they’re asking, or they will have a serious negative cash flow situation."

A skeptic, "Who will be able to pay higher rents? Are we not (mostly) predicting the end of this latest, ehem, 'correction' in the near future? We can’t simply project our personal situation on the broader population’s willingness or ability to pay higher rents."

From Florida, "I have been checking my local rental listings (north Florida) for three years now and last week there was suddenly a FLOOD of new rentals (especially in new construction condos and subdivisions). Also, a lot of Realty companies who used to focus on vacation rentals and sales are opening up their long-term rental sections (or is it departments?) again. The overall prices of these rentals are again matching 2003 prices it seems."

From San Diego, "In my area, Carlsbad-San Diego, rents have most definitely gone up in the past two years. In summer of 2004, we had LLs and prop managers begging us to rent from them (like a 5/3, blocks from the beach for $2,100 or our current house a few miles from the beach, 4/2 for $2,000). Currently, houses like ours are being rented for $2,500+ and the market is tightening. I think that is because people who can afford $2,000 rent are bubble-sitters who have enough money to be comfortable while waiting."

"In the long run, though, the empty houses will come onto the market and will likely depress rents. Basically, I think rents will rise for the short-term (already are), but fall in the long-term."

One sees an economic slowdown. "The housing bust will drag the economy downward, wages will fall as layed off workers take anything with a paycheck, and rents will follow the economy. In other words, don’t buy that duplex as an investment unless it’s going for a song."

A reply, "I’d expect this to be true overall. But I’d like to juxtapose that thought with that recent FDIC report linked here just a few days ago. The report stated the population will economically 'bifurcate,' that while many would grow poorer there would be a portion of the economy that actually get richer. That portion of our society will also impact rents, values too. Remember photos of the super cars the well off were buying during the 30s? Super cars and soup lines I believe the caption read."

One reader had a more specific question. "Speaking of rents, what do people think about possible different futures of SFH rental prices versus those of apartments?"