Inman News, an online news source for real estate and mortgage professionals, had an interesting story today (copyright rules prohibit me from providing a link). The long and short of it, though—today’s was the first article of a three-part series—is that the number of renters is increasing. I find this both gratifying and troubling.

It’s gratifying, because I predicted this would happen in an essay for Inman last October or so. This opinion was fairly widely derided by real estate agents sending in comments. To be fair, I don’t know what the remaining Inman stories will say. But I contended way back then that two phenomena were occurring. First, because of the housing meltdown, the element of risk in home ownership had become more obvious. Second, because of the nature of where the jobs are, staying in the same home for long periods of time (more than two or three years) was becoming less of an option for people.

It’s troubling, though, because of what it says. First, the dream of home ownership is fading for a lot of people. Second, the increase in renters evidences that a lot of people fell victim to foreclosure and lost their homes, or, as likely, short-sold them to avoid foreclosure.

Third is the unknown.  Just over one out of four homeowners is paying a mortgage valued at more than the underlying house is worth, and with the percentage of home owners diminishing to historical levels or below, housing is in over supply. If that’s true, house prices will remain flat or decrease for years to come, further widening the gap between mortgage value and the underlying house value. If people need to sell and can’t, add more to the supply of both houses and renters.