Wages have outpaced rent growth for 13 consecutive months. This trend is likely to persist in the near term helping to balance the massive rent outperformance in 2021.
In addition, wages rising by 4% have a much greater impact than rents rising by 4%. Why?
The median income in the United States is $59,540. A 4% increase is $2,316. If you subtract out a third for state and federal taxes, that leaves you with a $1,529 take home gain.
The median multifamily rent is $1,379 or $16,548 annually. A 4% increase is $662. If both wages and rents rise by 4% then the wage earner is gaining $867 annually ($1,529 – $662).
However, wages are currently rising by over 4% annually while rents are flat and falling:
Multifamily Market News 