| The question of rental prices considering global | | | | resources to support the increased numbers. This is |
| population trends is a difficult one. First, demand is | | | | especially true of water and food resources. Because |
| local. Second, many of the costs of renting are | | | | of this population shifts to less dense areas may be |
| commodity based. These specific issues generally | | | | large and continue well past the population peak date. |
| cause people to keep the discussion focused on their | | | | All projections are that U.S. population will peak at |
| local area because broader global effects are difficult | | | | 430 million or less. However, given this pressure, the |
| assess. Nevertheless, from a long term perspective | | | | possibility is good that U.S. population may continue to |
| the discussion is worthwhile. | | | | grow significantly for the remainder of the century. |
| For the United States and most of the developed | | | | An end point of 500 million to 600 million is likely |
| world, population is either level or falling in most of | | | | based on relative resources, federal growth policies, |
| these countries. This implies less gross demand | | | | and past national immigration trends. |
| pressure compared to the past. However, globally | | | | While this is a highly speculative discussion, the |
| growth to 9.5 billion from a current 6.7 billion level will | | | | argument exists that U.S. rental demand will continue |
| put intense pressure on many commodity products | | | | to climb outpacing new construction activity and |
| such as lumber, minerals, etc. Because of this, the | | | | being filled by steadily increasing housing density |
| global effect on new construction cost will potentially | | | | especially on a per square foot basis. The density |
| be much greater than in the past. At the same time, | | | | increase will support increasing rents, increasing rental |
| changes in the demographics within the U.S. suggests | | | | operations cost, and new housing needs while new |
| that trends supporting a move to greater density is | | | | housing growth will be relatively muted. |
| growing at the same time. This converging trend | | | | Investors will capitalize on these trends by purchasing |
| could have unexpected results. The potential that U.S. | | | | existing housing in the largest cities, lobbying for |
| new housing construction remains suppressed and | | | | increased resident density, changing rental policies to |
| becomes even more significantly suppressed over | | | | support density, and increasing net rent to gain |
| the period is arguably quite high. | | | | increased profitability. The result should be a vibrant |
| Outside of demand pressure, the global population | | | | multifamily housing market for investor with adequate |
| growth is focused in many countries without | | | | supply for national needs. |