The Safest Bet in Real Estate… rent will continue to go up

The stock market is teetering at spectacularly high levels.  Investment professionals insist there’s gonna be a new health care system,  a huge tax cut and huge public spending on roads and stuff.   Stocks dip or soar on every new tweet.
Meanwhile, inflation is rising, the Fed is raising rates, and home owners are hoarding real estate such that there’s nothing for sale.
What does that all mean?
It means that there will be even more renters than owners in the future.  Owner:rental table
Why did hedge funds and REITs grab massive amounts of property that got foreclosed in the Bush Depression?  And why are they holding on to it instead of liquidating and putting their huge gains on the sure bet that stocks will hit 30,000 this year?
Because they’re not stupid.  The worse the economy is for average people, the more renters there are.  And, if we leave aside that we are establishing a permanent underclass of tenants, why would this be a good thing?
Well, other investments go up and down, but rent almost never goes down. 
In Summit County, as in most resort areas, it’s an even better bet for landlords.  People might stop buying second homes, but they still take vacations.  So we still need workers and workers need housing.  And we certainly won’t pay workers enough to buy any, so what will they do?
RENT, of course!
So what can you learn from the hedge fund geniuses who brought you credit default swaps and other wonky stuff that caused the melt down of 2009?  Buy real estate and rent it out.  Let the suckers play the Wall Street slot machine.  You rent to the workers running the place.
But what about those benighted workers?  
Well, the Federal Reserve says that you guys will be worth about 40 times less than your landlord unless you make the leap into ownership.  Right now you have a median net worth of $5000 versus the $200,000 the guy you just rented skis to probably has.
Yeah, I know, you don’t want to be tied down to property, or own a car, etc.  And in the past that was OK until it dawned that eating dog food in your old age wasn’t appealing.
You used to be able to make up time and finish well.  
That ship has sailed.  Renters need to start earlier and work harder to catch the elevator these days, especially in resort areas.  But it can be done.  
I did it – you can, too.

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