Rents are Collapsing in Some of America's Biggest Cities

[Jonathan Twombly]

The Real Deal reports that rents are collapsing in some of America's biggest cities.  The article does not specifically say this, but this is no doubt related to the fact that development has been concentrated for ten years in certain submarkets of certain cities, with the result that there is a glut of rentals on the market.  The article focuses in particular in Chicago, which has the added headwind of decreasing population, though some people in the comments say that this is a "tale of two cities" issue, where population and rents are rising in certain parts of the city and declining in others.

Also, so far, rents continue to grow in smaller cities . . .

Here's the link.

[Anthony Dooley]

@Rick M. You are a perfect example of knowing the market. This kind of knowledge should make you very wealthy as a real estate investor. So many on this site talk of investing in markets that they don't know, and that is my biggest advice to new investors. Know your local market so that you recognize a bargain when you see it. 

To add to your insight, I notice that all of the new construction of multi-family is high-end and very expensive. This leaves a gaping opportunity for investors to focus on affordable housing for the average person. This means buying older complexes, renovating them, and renting them out based on median income affordability. This is a much larger market. When the downturn happens, it will affect the A+ and A class properties first.