It’s official—rent keeps increasing.
From January to October 2021, rent skyrocketed 16.4.¹ And the market hasn’t cooled off—housing costs increased for renters 0.3% between September and October alone.²
It briefly looked like the housing market boom was temporary. There were plenty of rumors that the bubble was about to burst. Queue the comparisons to the 2007-2008 housing bubble!
But prices have kept on rising. In fact, Americans have come to expect it—on average, they anticipate a 10% increase in 2022.³ Financial institutions agree—the Federal Reserve Bank of Dallas predicts the surge to continue until December 2023.?
Why? Because of a perfect storm of…
• Supply chain woes • Housing shortages • Historically low interest rates • First-time home buyers
In other words, houses are in high demand, but there aren’t enough available and they’re expensive to build.
And those problems aren’t likely to be resolved anytime soon.
But take all that with a grain of salt. If there’s anything that the last two years have proven, it’s that anything is possible.
For now, it’s best practice to prepare your budget for rising rents.
¹ “Biden’s next inflation threat: The rent is too damn high,” Katy O’Donnell and Victoria Guida, Politico, Nov 10, 2021, https://www.politico.com/news/2021/11/10/rent-inflation-biden-520642
² “Biden’s next inflation threat,” O’Donnell and Guida
³ “Biden’s next inflation threat,” O’Donnell and Guida
? “Biden’s next inflation threat,” O’Donnell and Guida