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Specifically, luxury rentals, which are currently struggling to find tenants, have become emblematic of a larger issue. Many landlords, overwhelmed by vacancies, are at risk of filing for bankruptcy, potentially leaving renters out in the cold. In a nation where half of all renters spend more than they should on housing, the rental market is beginning to experience the ramifications of overbuilding.
Historical Context and Trends
To understand the current housing market dynamics, we need to look back a few decades. Since the 1970s, housing supply has been tied closely to demand and economic conditions. For example, two years ago, the U.S. experienced a record-breaking year for new apartment constructions—one spurred by a generation of baby boomers transitioning to urban living.