Imagine it's July and 100° outside. You own an ice cream store. To your surprise, you learn that last night all your competitors within 20 miles lost power. All their product has melted. Now it's just you, your little ice cream shop, and a town of, say, 30,000 sweltering potential customers. What's your next move? Hold that thought for a minute...
Imagine it's 2014. You run a hedge fund that has acquired 30,000 single-family houses all across America. You've rented them to people who either lost their homes due to foreclosure or maybe just have poor credit. Either way, these folks have no choice but to rent for the foreseeable future. To everyone's surprise, the economy is now in recovery, unemployment is headed down and interest rates have just started creeping up. What's your next move?
Same answer for both: You'd start raising prices, wouldn't you?
Of course you would. Who wouldn't?
So let's all agree right now that when rents start rocketing into the stratosphere in 2014, we won't act all surprised and shocked. We won't waste time wailing and moaning about "evil corporate landlords" and "greedy hedge funds." We won't beg the Government to step in and "give the little guy a break."
Because, we'd all do the exact same thing, if we had the chance.
It's straight from the Monopoly game playbook: Once you buy up all those orange properties, you get to double the rents.
So, if you are a renter, what can you do? How should you be preparing for the big Rent Squeeze that's headed your way?
Check back here for Part II and we'll tell you!