Thursday, December 08, 2022

Rising rents driving up inflation, spelling trouble for the Fed

Rising rents driving up inflation, spelling trouble for the Fed

The overall recovery in the New York area has been uneven as some families have moved to the city, bidding up prices, while others are struggling to pay, said Jay Martin, executive director of the Community Housing Improvement Program. Represents landlords. Fixed accommodation mostly on rent.

“You have a war bidding for a unit, and then a renter who can’t pay,” he said. “The story of two cities happening within the same building.”

Drew Hamrick, senior vice president of the Colorado Apartment Association, a homeowners group, said the rent increase is driven not by landlords but by market factors.

“Landlords don’t really set the price, the consumers set the price,” he said. “These are musical chairs.”

Even if rents come down next year, today’s suddenly higher housing costs could make for a painful adjustment period. High rent costs can change through people’s lives and force them to make tough decisions.

Luke Martinez, 27, in Greenville, a city in East Texas, is considering buying a trailer and setting up his family on an RV lot after learning he’s missing the three-bedroom home he rents for about $1,000. taking over. per month since 2016.

“Even in this small Podunk town, the rent amount is insane,” said Mr. Martinez.

He wants to pay up to $1,500 per month for a new location, which will be tough. After closing at the start of the pandemic, he was living partly on savings — padded by an insurance payment after his car was stolen and totaled. He returned to automotive repair work this week. His wife was working at the front desk at a hotel until two months ago, but is now home-schooling their 8-year-old.

If they end up renting at a higher price, they are likely to drop a new car to afford it.

“It’s pretty much just scraping it,” he said of his lifestyle.

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