5 ms·

Why did the rent increase so much? Much higher demand than before?

butler14 3y ago
Interest rates go up, getting a mortgage becomes less affordable -> more people in the market for renting (in many areas, there's also a lack of rental housing stock) Professional landlords have built empires on low interest rates -> interest rates go up -> landlords pass the cost onto renters (or for smaller landlords, exit the market, potentially reducing supply further)
- importantbrian 3y ago
  Rent prices in Florida were skyrocketing long before interest rates started rising. Our last rent increase before we moved was going to be around 25% back when interest rates were still 0. If anything rent increases -- in South Florida at least -- are partly a zero interest rate phenomenon. There are a ton of half full midrise luxury condos that priced lots of people out of previously affordable communities built as the result of access to cheap capitol and money laundering. There was also the massive influx of people moving into the area during covid. All that to say rent prices in Florida are the perfect example of monocausal explanations for complex phenomenon almost always being wildly incorrect.
ethbr1 3y ago
Tl;dr Florida is weird. It's insanely city-centric, because the state is literally a swamp or sun-scorched grassland. On top of that, add a lot of foreign buyers, for various cultural, geographical, and political/economic-stability reasons (e.g. if you're a wealthy Haitian). On top of that, add a constant stream of snowbirds [0] and retirees. On top of that, add a huge tourist economy. At the end, you get a housing market that's really unstable (up and down). [0] https://en.m.wikipedia.org/wiki/Snowbird_(person) https://en.m.wikipedia.org/wiki/Snowbird_(person)
chank 3y ago
Tier 3 city are "undeveloped/no market" cities. So it could be remote workers moving out of high COL areas. But also a bit of greed sprinkled on top.

Interest rates go up, getting a mortgage becomes less affordable -> more people in the market for renting (in many areas, there's also a lack of rental housing stock) Professional landlords have built empires on low interest rates -> interest rates go up -> landlords pass the cost onto renters (or for smaller landlords, exit the market, potentially reducing supply further)

importantbrian 3y ago
Rent prices in Florida were skyrocketing long before interest rates started rising. Our last rent increase before we moved was going to be around 25% back when interest rates were still 0. If anything rent increases -- in South Florida at least -- are partly a zero interest rate phenomenon. There are a ton of half full midrise luxury condos that priced lots of people out of previously affordable communities built as the result of access to cheap capitol and money laundering. There was also the massive influx of people moving into the area during covid. All that to say rent prices in Florida are the perfect example of monocausal explanations for complex phenomenon almost always being wildly incorrect.

ethbr1 3y ago

Tl;dr Florida is weird. It's insanely city-centric, because the state is literally a swamp or sun-scorched grassland. On top of that, add a lot of foreign buyers, for various cultural, geographical, and political/economic-stability reasons (e.g. if you're a wealthy Haitian). On top of that, add a constant stream of snowbirds [0] and retirees. On top of that, add a huge tourist economy. At the end, you get a housing market that's really unstable (up and down). [0] https://en.m.wikipedia.org/wiki/Snowbird_(person) https://en.m.wikipedia.org/wiki/Snowbird_(person)

chank 3y ago

Tier 3 city are "undeveloped/no market" cities. So it could be remote workers moving out of high COL areas. But also a bit of greed sprinkled on top.