Tampa rents are going up. And they are going up fast. As a property owner (personal residence), rental property owner, and property manager this is good news for me and my property owning clients. But it should be viewed with caution by the Millennials that want to be “PermaRenters.”
Large private equity firms don’t invest billions of dollars in single family rental homes for fun. They do it for yield. And you get maximum yield by pushing rents up to the maximum the market will support. Read the full TBO article here:
http://tbo.com/news/business/study-tampa-apartment-rent-increases-among-largest-in-us-20150414/
Here is what I think this means for each of the following groups:
Homeowners: Nothing to do here. You own your own home. Congratulations! Rents going up will make your decision to own a home look better every year (especially with the tax benefits).
Investors: Overall good news. Higher rents should mean a higher return on your existing portfolio. Articles like this one on TBO unfortunately will draw more investors into the market which will limit your buying opportunities but on balance is a good thing for established investors.
Renters: There are lots of reasons to rent. Generally if you are going to live in the same City for five or fewer years renting is a great decision. If your life has uncertainty (job, family, lifestyle, city, housing needs, etc) renting is the right decision for you. But be careful not to be a “PermaRenter” and let the next 30 years pass you by. Homeownership is still the best way to create wealth over a thirty year period for most Americans. While there are no guarantees in life and many of those that bought homes in 2006/2007 lost big – it still should be an option most people consider once they are established, stable, and likely to stay in the same area for five or more years.