The Truth About the Rental Crisis (From a Landlord with 10,000 Units)
Ken McElroy Show
Ken McElroy
4.8 • 692 Ratings
🗓️ 28 January 2025
⏱️ 55 minutes
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Summary
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Visit Ken's Bookstore: https://kenmcelroy.com/books
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ABOUT KEN: Ken is the author of the bestselling books The ABC’s of Real Estate Investing, The Advanced Guide to Real Estate Investing, and The ABC’s of Property Management. With over two decades of experience in real estate investing, Ken McElroy is passionate about sharing the good life by helping real estate investors grow and prosper. This podcast is a place for Ken to discuss numerous topics connected to real estate investing, including finance, budgeting, the entrepreneur mindset, and creating passive income. Ken offers a wealth of personal experiences, practical advice, success stories, and even some informative setbacks, all presented here to educate and inspire. Whether you’re a new or seasoned investor, the information and resources on this channel will set you on a path where you and your investments can thrive.
Ken's company: https://mccompanies.com
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Transcript
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| 0:00.0 | interest rates are up maintenance costs are up HOA fees are up property taxes are up and rents are down |
| 0:12.2 | up to 30% in some markets which is having investors panicking so let's let's first break this down |
| 0:20.2 | from i think it's different like when when MC is getting good deals on properties right now, right? |
| 0:25.9 | Because our company is purchasing really great deals, but we're not in the normal rental market than most investors are in. |
| 0:33.8 | But it is important that we watch them. |
| 0:37.2 | So in other words, we look at over 60 different metros. |
| 0:42.2 | So I'm always looking at rent growth. |
| 0:45.2 | Rent growth is a key component to income growth. |
| 0:49.0 | So we definitely need to know which way are rents going. |
| 0:52.7 | Because if you're budgeting and you think |
| 0:56.0 | they're going to go up next year you're you know you're going to have a really rough couple |
| 1:00.2 | years and that's actually what got a lot of people in trouble this is one of the core systemic |
| 1:05.2 | problems that a lot of syndicators and a lot of people really don't understand this business |
| 1:09.3 | they just assumed because we had it so |
| 1:12.5 | darn good for the longest time, that rents were always going to go up. Right. And so this is |
| 1:18.1 | giving things back to the tenants. This is now turning into a renter's market. It is. But it's also the |
| 1:24.3 | reason that investors are in such a bad dilemma is your mortgage might be a set payment. |
| 1:29.3 | But with all these other costs going up and then rents going down to boot, it's really putting some investors on a bad position. |
| 1:37.4 | Right. Vacancies up and that's non-rent. Of course, rents are flat. |
| 1:42.3 | That's if you get a renter, you're not going to have rent growth. |
| 1:46.0 | And then, of course, you got operating expenses also up. So, you know, we were on the brink of what I would |
| 1:53.7 | consider to be an affordability problem for our renters. So rent was far surpassing wage growth. |
... |
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