Cash Rents Fall, but Enough?
By Brent Gloy
The second article we wrote on this site was an analysis of cash rental trends. That was back in 2014 when cash rents had been escalating rapidly and commodity prices had turned sharply lower. The central question was where rents were headed. We concluded that annual large declines (in excess of 10%) were relatively rare and that if rents were to continue to decline you would likely see it play out over several years unless commodity prices rebounded. Unfortunately, it turns out that commodity prices haven’t recovered and rents (and land prices) have drifted lower. This week we will take a look at whether rents have fallen enough, or whether further declines are likely. (more…)