The Effect of Rising Rent Prices

Every month, millions of renters across the United States scramble their income together to pay rent. It’s not something they necessarily want to do and it’s often one of the most stressful days of the month, but it’s something they need to do if they want a proper roof above their head.

While rent day is already filled with a lot of stress, the rising rent prices of today are only making matters worse. Rent prices have been rising at rates of 10% when compared to last year and some cities are seeing rent rise as high as 25%. Even worse, it doesn’t seem to be going away.



Even if rent growth starts to ease up at some point, it’ll take a while for income growth to catch up – especially since income growth isn’t rising nearly as fast. This could mean tough days ahead for many low-income families that are already struggling to make ends meet each month.

What’s Causing Rising Rent Prices Today?

Rising rent prices are nothing new. In fact, it’s something we’re used to experiencing every single year – prices seem to increase in the spring and summer, but eventually decrease during the colder months of the year. The rising rent prices are usually small, minor, and temporary. 



For example, the monthly change in national median rent price is usually under one percent – whether it’s increasing or decreasing. Since January 2021, that median rent price has continued to increase each month and increased as much as 2.5% by the summer months. 

Here are some of the most important factors that are causing the rising rent prices:

• Household consolidation isn’t as popular as it was at the beginning of the pandemic, meaning more people are competing for rentals.
• Rising costs of buying homes is making rentals a much more attractive option, leading to a crowded rental market. 
• New home construction slowed down during the pandemic, meaning new homes are harder to come by.
• The national vacancy rate is extremely low, meaning there are less rentals available and landlords are filling apartments/homes fast.

While December shows a small glimpse of hope as we start to see our first positive signs of rent prices stabilizing, it’s unclear how long it will last and if the change will be significant enough to make a difference. Some experts think prices will continue to rise for the foreseeable future. 

How Do Rising Rent Costs Impact Renters?

Rising housing costs are making it extremely difficult for individuals and families to live a quality life. With rent growth largely overshadowing income growth, many people are spending as much as 30-45% of their monthly income on rent -- whether it's one-bedroom rent prices, two-bedroom rent prices, or larger.

That doesn’t leave a lot of room for other expenses. Let’s take a look at some of the other ways rising rent costs impact renters, households, and families:

• Renters are spending a majority of their monthly income on rent
• Renters don’t have the necessary funds to pay for other expenses
• Renters aren’t taking good enough care of their body (stress, diet, sleep, health care)
• Renters can’t afford to live in their home as homelessness starts to rise
• Poor living conditions and a lack of hope result in a toxic environment



If rising rent prices don’t stabilize in the near future, many families could find themselves without shelter. With the winter months now in full effect, that’s something we need to avoid as often as possible. We can’t have individuals, families, and children being denied basic needs like shelter. 

How Does Rent Inflation Impact the Community?

Increasing rent prices don’t just impact the household, but they impact the community as a whole. When residents are struggling to make ends meet, the neighborhoods they live in also struggle. This creates a vicious, never-ending cycle that results in long-term hardship. 

 Let’s take a look at some of the ways increasing rent costs impact the community:

• Residents aren’t spending money on products and services in their community
• Local governments don’t have the funds to invest back in the community
• Green areas, schools, and public spaces aren’t being cared for nearly enough
• As more families struggle, that toxic environment spreads outside the home
• Crime rates start to rise as renters and children start making bad decisions



As more communities suffer at the hands of rising rent costs across the United States, the damage will only continue to worsen. More families will find themselves in tough situations and their community won’t have the wherewithal to help them out of it. The vicious cycle continues.

How Does Rising Rents Impact the Landlord?

In addition to the renter and the community they live in, the landlord is also impacted by rising rent prices. Not only does this make their job much harder when maintaining their property and avoiding vacancies, but it can put them in a position where they have to consider selling. 

Let’s take a look at some of the most prominent ways increasing rent prices impacts the landlord:

• Landlords experience more vacancies due to the renters’ inability to pay rent
• Landlords face far more evictions and missed rent payments
• Renters have a more difficult time taking care of the home, leading to damages
• Landlords have to reconsider some of their restrictions, such as the 3:1 rent ratio
• Landlords are more strict than ever about background checks and credit checks



If landlords start to struggle or don’t feel their job is worth it anymore, renters could be met with a lot less options when looking for rental properties. This will force the renter into even more difficult situations than before – forced to choose between poor conditions and buying a home.

How Can Old Glory Housing Help Provide Relief?

At Old Glory Housing, we firmly believe every individual and family should have access to safe and practical living conditions – even low-income families that are trying to build a better life for themselves and their family. That’s what drives us towards helping others find a forever home.



Through the power of restoration and giving less-desirable homes a fighting chance, Old Glory Housing can help low-income families find affordable homes in their area. Contact us today to learn more about how we can help you, your family, and your community thrive and prosper.