Short Term Rental Riches 88. It’s INEVITABLE, Rents ARE Going Up
Jul 20, 2021
Rents in the U.S. are skyrocketing, fueled by a significant housing supply shortage and increasing demand, particularly from millennials. The podcast breaks down the economic principles behind this trend, emphasizing that the factors affecting supply and demand are complex and multifaceted. It also discusses how rising rents create investment opportunities in real estate, especially for those willing to leverage property. Additionally, it touches on regional variations in rent changes and the evolving preferences of today's renters.
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Supply Drives Rent Increases
- Rent prices are rising primarily due to supply and demand economics.
- The US faces a housing shortage caused by slow building, rising material costs, and preference for higher-end homes.
Millennials Fuel Rental Demand
- Millennials form the largest demographic driving rental demand as many cannot afford to buy homes.
- Rising interest rates also reduce home buying affordability, pushing more people into renting.
Regional Rent Trends Vary
- Some markets experience dramatic rent increases, e.g., Jacksonville up 35%, while others like San Francisco see declines.
- Population migration trends to states with no income tax and better weather intensify local rent demand.