It Is Beginning: 41 Percent Of All Small Business Owners Could Not Pay Rent In November
Francesco Abbruzzino, The Uncensored Report, LLC
Many experts are now warning that we could see the housing market and the commercial real estate market simultaneously crash in 2023. If that were to happen, it would put an extreme amount of stress on our financial system. The only way we will avoid such a fate is if the Federal Reserve starts reducing interest rates. Unfortunately, that isn’t going to happen. In fact, officials at the Federal Reserve keep telling us that interest rates are going to keep going up. This is literally a suicidal course of action, because higher rates are going to absolutely crush the economy.
If you doubt this, just consider what is already happening.
According to a new Alignable survey that was just released, 41 percent of all small business owners in the United States could not pay rent in November…
Due to high inflation, reduced consumer spending, higher rents and other economic pressures, U.S.-based small business owners’ rent problems just escalated to new heights nationally this month, based on Alignable’s November Rent Poll of 6,326 small business owners taken from 11/19/22 to 11/22/22.
Unfortunately, 41% of U.S.-based small business owners report that they could not pay their rent in full and on time in November, a new record for 2022. Making matters worse, this occurred during a quarter when more money should be coming in and rent delinquency rates should be decreasing. But so far this quarter, the opposite has been true.
In September, that same survey found that 30 percent of all small business owners could not pay rent.
Many were deeply alarmed by that figure, and then it jumped up to 37 percent in October.
Now we are at 41 percent, and if there is any time when small business owners should be able to pay rent it is during the holiday season.
When commercial real estate tenants cannot pay rent, it inevitably has a domino effect.
It appears that we will soon have millions of empty commercial spaces all over the nation, and many owners will soon be unable to make loan payments because sufficient rent money is not coming in.
If the Federal Reserve insists on raising rates even higher, I anticipate that we will eventually be facing a commercial real estate crash of unprecedented size and scope.
Meanwhile, the implosion of the housing market continues to pick up speed.
Existing home sales have now declined for nine months in a row, and the median price of a home in the U.S. has now fallen by about 7 percent.
Sadly, many experts are now warning that things will only get worse in the months ahead. Here is one example…
“In one line: Collapse in prices is coming,” wrote Kieran Clancy, senior U.S. economist at Pantheon Macroeconomics.
I told my readers that this would happen if the Federal Reserve aggressively hiked interest rates.