How To Model Inflation?
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On today\\u2019s show we\\u2019re talking about a question that is on a lot of investor\\u2019s minds. We keep hearing from the Federal Reserve and government officials in the Treasury department that inflation this year, while elevated, is expected to be transitory. That is to say, it\\u2019s temporary. We have seen rents increase, sale prices increase sharply in response to low supply of housing.
\\nWhen it comes to certain commodity prices, we\\u2019ve seen prices rise and later fall based on short term supply and demand dynamics in the market place.
\\nRents have a general tendency to stick. They tend to rachet upwards. Even older buildings tend to increase rent, but more slowly. Unless a building is truly an inferior quality living space, you can expect to see rent increases approaching the market average.
\\nThe rising cost of land and the rising cost of construction are the major factors that drive higher asking rent for new buildings.
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\\nHost: Victor Menasce
\\nemail: podcast@victorjm.com
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