Yes and if you purchased a rental property recently it will cost more to cover the mortgage, taxes, insurance etc… for that property due to the higher RE prices so rent increases as well.
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That would be true for newly bought properties, but not ones that have been in the rental business for a long time. The latter is what I’ve been hearing stories about, both in the news and in person.
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I raise rent frequently and I’m still behind the market rate. My sister doesn’t like to raise rent, she’s complaining constantly about not having money. In fact when one tenant moved out they introduced another one because her rent is way under the market. And best yet, she refused to sell, who knows why, she has no heirs. But at this rate, I’m not taking her problem to be my problem.
Here’s what went up recently, the landscaper decided to raise the rates, the insurance went up, if something goes wrong, whoever we hire to fix the problem, they charge at market rate.
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That’s one area we differ. Our tenant is responsible for mowing the lawn + whatever other landscaping he wants. Our insurance went up, but not by much - not enough to change anything on our end. I don’t even think it was $10/month increase. If something goes wrong, H is first in line to fix it and he can fix almost anything. If it’s larger than that he has work contacts he uses and they aren’t exorbitant (for us anyway). We make enough extra each month that taxes and repairs are technically included with no real OOP for us.
We were renters in our younger life, so we can appreciate “the other side” and hopefully our keeping the rent the same as it’s been since he started renting is helping our tenant out. To us, that’s desirable too.
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Seems like it would not be surprising if many small landlords did not raise the rent (or raised it at a lower rate than the rental market in the area) for tenants that they liked, but raised the rent as much as the market will bear for tenants that they did not like as much.
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When we were looking for a multi-family house to live in (and rent out the rest) our real estate agent said that price increases were used as a way of moving undesirable tenants on. A $25/month increase was for good tenants while a $300/month increase was for those that might need prodding to move or that one wouldn’t care if they moved.
We’ve kept the rent for our tenants the same. The few increases happened when the tenants voluntarily vacated. Our current tenants have been there about 3-4 years and there haven’t been any rent increases in that time.
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With restaurant meals and hotel rooms, the quality has not gone up. In my experience it has gone down. And with prices having gone up so much and so fast, it leaves me with the feeling of getting ripped off, which when the business is selling experiences is not good for future business.
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Last year, there were articles about restaurant workers leaving the industry permanently for better paying better jobs elsewhere. It would be no surprise if this left a shortage of labor in the restaurant industry, resulting in higher prices and less service.
If there are also fewer unauthorized immigrants that restaurants historically hired lots of, that could also contribute to the labor shortage.
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Of course native people can become hotel staff too - no reason they can’t, but yes, France also has immigrants as staff. Here’s a Google article about one who rose from maid (and other low paid occupations) to elected to National Assembly:
The article title is upper middle class feeling squeezed by inflation.
The title of this thread is UMC struggling with inflation.
Feeling squeezed seems more apt than struggling. We think we are feeling inflation, the price of gas and food, travel, definitely can feel it.
But also the UMC spent 2 years not going out to eat, not traveling. Many were also the recipient of the stimulus checks. Even though plenty of employed middle class people didn’t need stimulus checks, they still got them.
So of course people are feeling inflation. They are traveling, going out to eat in restaurants. Things they didn’t do for 2 years. And gas and food prices have also increased. Leading to feeling squeezed.
I’m not struggling but I do have to make choices. Something I hadn’t done since 2019.
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This article was in WSJ, I couldn’t access this link from Apple News, I think I finally found the definition of UMC, income between $75k to $135k.
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“Upper middle class” seems to have a very flexible definition. For example, on these forums, it is commonly used to describe families that get no college financial aid anywhere (meaning income in the upper $200k range or higher, perhaps top 4% or so).
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Not according to that article, I read it last night, however I can’t find it again.
Here it is I found it. $75k to $127k
If that’s their definition, we’re smack dab in the middle of it. So far (knocking on wood), we haven’t had any problem whatsoever with inflation, but as I said before, we didn’t buy much before Covid, etc, either. When we do buy stuff or go out to eat, etc, I still get what I want and haven’t had to cut back anywhere. The last sort of major item (> $100) we just got was an electric chainsaw to cut down some trees that need to go (they’re growing on our pond’s dam - big no-no for longevity of the dam).
Those who buy more “stuff” (whether it’s food, trinkets, or whatever) are going to be affected more.
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So 60th to 80th percentile (second quintile) income by that definition.
Which is different from the definition commonly used on these forums.
Upper middle class, upper income, affluent, high net worth - these definitions vary greatly.
A person making $200k in Mississippi is upper income but in NYC, they barely save anything after taxes and cost of living.
Couples who have a few million will probably tell you they’re upper middle class while a worker at McDonald’s will never save that much in their lifetime.
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Those owning rental properties were under an eviction and rent moratorium for up to 18 months. That meant NO income plus continued rising expenses. While large corporate entities can weather that type of situation, mom and pop can’t.
So darn tooting right. Any landlord that has the opportunity to jack up the rents is doing so to the maximum possible. Not only to make up for lost revenue - but also to hedge against another rent/eviction moratorium. They are trying to back fill their own reserve.
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Our tenant never quit paying, even when we offered to help him out if needed.
Just because they could stop paying doesn’t mean everyone did.
In PA there was some sort of program to help landlords out if their tenants couldn’t pay. I never checked into it because we didn’t have to. Other states might not have done anything, of course. I don’t keep track.
For as much as I complain about PA when it comes to higher education and funding, the state does a lot right otherwise. This year we even had a hefty budget surplus lawmakers had to figure out how to use (not including anything from the feds Covid related). Schools did get a decent chunk of it, both K-12 and college. As a state, right now we’re thriving (individual areas can vary, of course).
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Op quote the article and UMC is defined in there, that’s should be part of the discussion. Not some far fetched income from some forums.
As soon as Portland, Maine put rent control into effect, I told my husband our daughter’s landlord would sell the building. Within two months, I was proven right and D was in limbo without a lease under the old and new owners. It stunk. It took her many months to find a new place. $2,700/month for a three-bedroom with two other young women. $900/month is a lot at her entry level salary.
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