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> But rate hikes are driving higher rents This doesn't make sense to me. Rate hikes decrease spending overall, so why would rent be any different?
by Aunche 4y ago
> But rate hikes are driving higher rents
This doesn't make sense to me. Rate hikes decrease spending overall, so why would rent be any different?
- bfgoodrich 4y ago
- aluminussoma 4y agoThe increased rates make home mortgages unaffordable. This pushes housing demand to rents because people need to live somewhere. Rental prices increase while home prices decrease - bad, bad stagflation.
- deathanatos 4y agoDemand for a place to live is much more inelastic. And rate hikes make it harder to purchase a home, by raising the cost of them. That forces out of the home-buying market those who would have bought a home at the pre-hike rate … and forces them back into the rental market. Seems to me like demand goes up. (Certainly, it makes it harder for landlords to acquire new properties, but I think corporations are going to weather it better than people — i.e., people will be forced out of that market before corporations.)
- zormino 4y agoAlso new mortgages and variable rate mortgages get more expensive, and landlords need to charge more to cover their costs.