The Steady Rise of Monthly Rent
The steady rise in rent costs across the U.S. can be a hassle or even a burden to many Americans and often leads to financial difficulties. Individuals have to sacrifice much more to pay for their rent and typically have a lower net worth as a result.
The steady rise in rent costs is a major concern across the U.S. The steady rise in rent typically leads to financial struggles and other personal problems for individuals unable to meet their monthly expenses. Not only does this lead to unnecessary financial strain, but it also leads to poor quality of life for many Americans. Many Americans have less money for food, travel, and entertainment.
But why exactly is this happening?
6 Reasons For Rising Rent
Dr. Jordan Sudberg outlines the following six major reasons why rent costs have been rising in recent years:
1. Unaffordable Housing
For several years, America has seen a significant shift from a home-owning nation, where many individuals and families owned homes, to a renting nation. This is largely due to the unaffordable home prices and the high monthly payments and maintenance costs. Due to this, many individuals cannot purchase a home and are forced to rent.
This has created a high demand for houses for rent forcing property managers to raise the prices of rental units.
2. Demand For Millennial Workers
As individuals have moved away from rural areas and into urban areas, like New York City or Washington D.C., new jobs have been created in these cities due to the high demands for labor in these markets. Not only do these cities provide higher-paying jobs, but they are also typically easy to commute to, causing more Americans to move there to find work.
As more individuals move into these cities and regions in search of work, demand for furnished high end rental apartments also rises. And as the space available for urban residents is limited, the prices for existing rental properties soar.
3. Population growth
As the population of the United States continues to grow, steadily rising rent costs will undoubtedly occur. This is largely due to demand and supply. As the demand for real estate in urban areas increases, property managers have been forced to raise rent prices.
4. Property maintenance cost and repairs
The property owners pay for all maintenance and repairs, which can be very costly. The property manager offset this cost through monthly rental fees.
5. Rising income
As income rises, so does the rising demand for real estate in urban areas. This is largely because more individuals can afford higher-priced housing units.
Property managers increase their rental prices to attract this class of individuals.
As inflation increases, so do the prices of goods and services. This includes rental prices as property owners are forced to increase their rental fees to compensate for rising costs.
According to Dr. Jordan Sudberg, America will continue to witness a steady rise in rent costs throughout the next few years. With inflation on the rise and the dollar’s purchasing power diminishing, property owners will continue to increase rental prices to cover costs. This will continue to strain Americans who are in search of affordable housing.