Dear FutureMoneyTrends.com Member,
Renter households have jumped from 38 million in 2008 to 42.4 million, according to the U.S. Census Bureau. The best part about the rental boom is that due to artificially-low interest rates, we are seeing an anomaly: ***rising rents, while real wages are down.***
Landlords are becoming more and more recession-resistant by the day. With low vacancy rates, high demand, and effective rents increasing, now may be the best time to become a landlord. Since June of 2009, the top 1% of income earners took fully 93% of the income gains in the U.S.!
The data is in: the millennials are renters, possibly for life! The top jobs for college graduates since 2009:
- Food Service Employee
We fully expect the rental boom to continue for a very long time. The U.S. economy has no driver for jobs, and now the one sector that was responsible for net wage increases is crashing! Oil, Texas gold, was literally the force behind the U.S. upturn in the midst of a structural depression.
Take away Texas and North Dakota and you eliminate all wage gains since the year 2000. Texas alone was responsible for 90% of good-paying jobs since 2009. In fact, if you remove Texas from the U.S. since the last official recession, America has actually had negative employment. The destruction of the middle class is altering when people get married, have children, and buy a home.
The biggest driver for the rental boom, though, is the Class of 2009 through 2015, and for that matter, any graduate during the rest of this decade. Young people drive rental markets and new home buyers, but today’s young people will not be buying homes.
America’s Youth, those 18-25, are going to college and loading up on student loans and consumer debt. Upon graduating, only 43% of them are in careers for what they went to school for. The class of 2014 has a total average debt of $35,200, according to a Fidelity Survey. This includes about $27,000 in government loans and $8,000 in other college-related debt, including credit card, personal, state, and private loans.
These tenants will not be saving up to purchase their first home and will be chronic renters for a good majority of their lives. With Obamacare now in place, many employers are reducing part-time work hours to less than 30 per week, which is also boosting the freelance economy trend we have been forecasting.
Now may be the most optimal time to be a landlord in America, with low vacancy rates and new renters en route by the millions! Two of the last five Cash Flow for Life letters have covered how to buy single-family homes at a discount and buy a successful rental property. To gain full access to our archive of income ideas, click here.