It’s because all Landlords are greedy SOB’s, right?

Hahahaha. Well, some might be but that is NOT the real reason rents are so high.

Reason #1:

Inflation. I know you know that word. For some reason, with the price of everything having gone up since COVID, people tend to be shocked that rents have gone up too. Inflation affected everything, including rent values.

Reason #2:

We have been in a housing shortage since the Great Recession ended. That means we don’t have enough housing for everybody, regardless of whether you are renting or buying. More demand than supply means scarcity. Scarcity means higher prices. If there are 99 people looking for a place to live and 100 properties available, prices will go down. If there are 99 properties for rent and 100 people looking, prices will go up.

Reason #3:

Interest rates/Property Taxes/Homeowner’s Insurance. Put yourself in the shoes of a landlord. Why do you think they put up with middle of the night calls about stopped up toilets? It is because they want to make money from letting you move in their property worth hundreds of thousands of dollars for merely the deposit of a single month’s rent and the hope you will pay next month’s rent. If they cannot make money, they won’t do it. Would you go to your job if you didn’t make any money? Rates are higher. Property values have gone up, forcing property taxes to go up. Homeowner’s insurance has gone up as well. They have to pass these expenses onto tenants just as any business has to do.

Reason #4:

The high cost of buying a house. Rent prices are somewhat indexed with real estate prices. Let’s say you live in a house worth $200,000 that you rent for $1500 a month. If you were to put down 3% and buy that house yourself, it would cost you over $1600 a month for a mortgage. (That is principal, interest, taxes, insurance.) Plus you would have to pay out of your own pocket to maintain the house. When you put it in that perspective, renting sounds like a bargain.