Tuesday, September 22, 2015

Soaring Rents; No Stop to the Climb

The Bureau of Labor Statistics shows that rents are climbing far more rapidly than overall price inflation.

We are  now plus 3.5% in annual rent increases nationwide, according to the BLS. But the latest Zumper National Rent Report (August 2015) shows that many major cities are experiencing very strong double-digit price increases:

Oakland, CA – $1,980 (+20%)

Austin, TX – $1,170 (+17%)

Kansas City, MO – $770 (+16.7%)

Sacramento, CA – $900 (+15.4%)

San Jose, CA – $2,230 (+14.9%)

Atlanta, GA – $1,250 (+13.6%)

Dallas, TX – $1,190 (+13.3%)

San Francisco, CA – $3,500 (+12.9%)

Chicago, IL – $1,920 (+11.6%)

This, of course, is not fun for renters, and certainly dispels the idea that there is a price deflation threat.

I anticipate that rents increases will accelerate and are a harbinger of more serious across the board price inflation. You just don't see these kinds of price increases unless there is plenty of money around to support the price gains.


1 comment:

  1. Robert, do you think this is a harbinger of an imminent housing bubble (I realize we're in a housing bubble now, but I'm talking about a more pronounced bubble)?