My personal inflation rate just edged higher.
Last week, when it came time to pay for my Chicken and Bacon Ranch Melt sandwich at Subway restaurant (always on flatbread), for the first time…I was asked to leave a tip.
I was surely the only customer that day to excitedly point to the payment terminal and frantically yell:
“Look…this is not transitory! This is indicative of real service inflation!”
Well, that’s what I thought anyway.
But I was probably one of the few restaurant patrons to understand that inflation actually benefits my personal economy overall.
To consumers, inflation makes them drift closer to poverty. Prices go up, products shrink, and more restaurants are asking for tips.
To savvy real estate investors, inflation makes us drift closer to prosperity. Real asset prices balloon, debts debase, and rents spike.
In fact, single-family home rents just saw their largest gain in nearly 15 years.
Year-over-year in April, they were up 5.3%.
That’s for SFHs overall.
But for detached SFHs (not townhomes), rents are up a whopping 7.9% over the same period.
Millennials in particular seek more outdoor space.
The other nascent phenomena is that home prices have risen so far, so fast that the affordable first-time homebuyer is becoming priced out.
They can’t own.
Then what must they do? Rent.
This heightened rental demand is now pushing up rents.
If you’ve been following my plan and buying income property with fixed-rate loans, you’ve simply never been more profitable.
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