Considering the situation described above, the costs of rentals will become higher.
This is because when a lot of people lose their homes and start renting, there would high demand for house rents, thereby leading to a high cost of rentals.
The cost will change because the demand is increasing, and it might even increase more than the supply; hence, the cost of rentals would increase.
The economic principle that explains this concept is known as the "Housing Bubble."
A Housing Bubble is a phenomenon whereby there is an increase in housing prices or the cost of house rents due to an increase in demand, speculation, and high spending from the people.
Hence, in this case, it is concluded that Housing Bubble is an economic phenomenon that can drive the cost of housing up.
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