What to Expect as a Landlord in 2022?

Labor Costs Will Rise

The December labor and jobs statistics showed mixed grades. Though the unemployment rate declined to a healthy 3.9 percent, the labor force participation rate remains well below the pre-pandemic rate of 63.4 percent. With millions of working-age Americans on the sidelines, the tightening labor market conditions have pushed average hourly earnings to an annual increase of 4.7 percent.

These numbers will surely affect our industry as contractors raise prices to help retain current employees and even bring in new ones.

Materials Will Cost More

It is no secret that inflation is on the rise and hitting historic rates. The December numbers showed prices of goods and services jumped 7 percent in the past 12 months, the highest rate since 1982. Though there is debate as to whether these skyrocketing prices are transitory or not, we do not expect material costs to drop. Instead, we suspect materials will cost more, meaning more expensive appliances, hardware, and so forth.

Landlords can expect sticker shock when it comes to maintenance, repairs, rehabs, and replacements.

Projects Will Take Longer

Contractors are struggling to retain employees let alone recruit new ones. Moreover, logistic woes have lengthened the delivery times of crucial materials. Couple the labor shortage and supply chain disruptions with very high demand and you have projects that used to take five days now taking a week or even ten days to complete.

There is some good news though.

Rents Are Going Up

You might be taking a sigh of relief. The increasing prices has not left rent in the rearview. In fact, the average cost for a one-bedroom apartment has risen by 16 percent nationwide in the past year. This number is a staggering 22 percent for Georgia in the past year.

Home Values Should Rise

We have seen a blistering-hot real estate market in the past year with some homebuyers purchasing properties without even setting foot on the lot. Average sale prices of Georgia homes increased by double digits in the past year. The factors mentioned earlier are affecting the real estate supply, and we do not expect home prices to fall anytime soon.

Looking for a Property Manager?

If you are looking into property management companies, then give 3 Options Realty a shot. The professionals at 3 Options Realty have experience with buying, selling, renting, and managing both residential and commercial properties. Call now to consult with a friendly representative.