Here's How the Debt Ceiling Deal Hurts Equity Residential
Times are tough for young Americans in the housing market. The COVID-19 pandemic pushed the Federal Reserve to cut interest rates to 0%, which touched off a bull market in houses. Real estate prices rose at a high-teens clip for a couple of years, which negatively affected affordability. At the same time, mortgage rates have increased dramatically as the Federal Reserve has raised rates. Finally, the student loan payment pause enacted during the pandemic is sunsetting in August. What does all of this mean for apartment real estate investment trust (REIT) Equity Residential (NYSE: EQR)?
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Equity Residential is a REIT that focuses on apartments targeted toward upscale urban professionals. Equity Residential has its apartments in places like Boston, New York City, the San Francisco Bay Area, Seattle, San Diego, and Washington D.C. These apartments are largely targeted toward luxury renters, which are primarily younger, well-paid professionals in knowledge industries. This type of tenant is also more likely to have student debts.
Source Fool.com
