A new study from the Harvard Joint Center for Housing Studies, suggests that the rental market is beginning to tighten and with vacancy rates falling, rents are increasing. The reason for this is that the rents could rise sharply as the demand increases. The study also suggests that affordability is likely to go down over the next few years as persistently high unemployment limits renter income gains. However, when the job growth regains momentum, the number of renter households could climb quickly. What this means is if there is a sharp increase in demand, this could quickly reduce vacancy rates and put upward pressure on rents. With the economy in recovery, this may increase the rent pressures on households still struggling and the foreclosures would continue to spur growth in the number of renter households as former owners switch to renting. The single-family home foreclosures will also add a steady flow of units to the rental market and the ability of renter households to occupy these homes will be an important factor in maintaining stability. Soon Congress will take up debate about what, if any, the role of GSEs should play in the mortgage markets and policymakers must consider the vital importance they have as a source of capital for rental housing.