Rent and inflation

In 2022, the rental market
continued to recover from the
low rental growth rates recorded
in most of 2020 and 2021 as a
result of the global pandemic.

However, ongoing recovery and rising rental
growth rates can’t be guaranteed as we move
into 2023, as higher interest rates, persistently
high levels of inflation and a struggling economy
all affect tenants’ ability to pay higher rents.
Although interest rate increases are commonly
used to curb inflation, other factors – like the
high price of globally-traded commodities – are
keeping prices stubbornly high. More interest
rate increases are forecast for this year, as is
a possible recession.
That being said, higher interest rates make it
less affordable for tenants to buy properties,
which increases the demand for (and prices of)
rental properties.

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