A recession can severely impact the economy, though the severity of this impact varies. Several experts agree that a recession is likely to occur within the next several years, despite the recent upturn in the economy. However, due to the necessity of housing, an economic recession is unlikely to affect the rental market as much as the unemployment rates. It may slightly impact the average rent and interest rates, but understanding the impact of a recession can help a landlord to combat potential devastation to their business.
Keep Your Tenants Happy
It is vital now, more than ever, to keep your tenants satisfied with living on your property. A recession may impact their budget, so you may wish to consider lowering the monthly rent payment. After all, a tenant that pays less rent than they previously were will still bring in more money than a vacant unit. Make sure that you consistently check your competitors’ monthly rates, because charging more than the average can be devastating to your business during a recession.
Ultimately, you should refrain from panicking when an economic recession is likely coming. There will always be a need for housing. In general, the likelihood of renting or selling property will depend largely on supply and demand. Houses are not being built at a rate that overtakes their necessity, which is why a recession will not have nearly as severe an impact on the rental market. In fact, an economic recession may actually benefit the rental market, as potential home buyers are more likely to wait to buy a home until more stable economic periods.
In the past, the Salt Lake housing market has been one of the most severely impacted in the country. It is important to make the necessary steps to prevent a recession from impacting your business. Keeping your tenants happy with living in your property is vital to prevent excessive vacancies on your rental properties. To learn more about the impact that a recession can have on your rental business, contact us at the Salt Lake Keyrenter today.