Grant Cardone Predicts Rents Will 'Explode' In 2026 After Falling Flat Next Year — This Is What's Driving His Theory

Real estate magnate Grant Cardone recently highlighted key movements in the housing market on X, pointing towards shifts that prospective home buyers and investors need to watch. 

On April 30, Cardone posted a sharp decline in apartment starts by 20.8%, predicting that this halt in multifamily construction projects, driven by the high cost of debt, will lead to a shortage of homes and cause rents to "explode" by 2026.

The decrease in apartment construction is attributed to the rising costs of borrowing. With debt becoming more expensive, developers are pulling back on launching new construction projects, especially in the multifamily segment. The contraction in new developments is expected to lead to a tighter rental market. As the supply dwindles while demand remains steady or grows, the consequence, according to Cardone, will be a dramatic increase in rental prices by 2026.

Cardone forecasts a temporary dip in rents in 2025, suggesting a potential relief for renters. However, he advises real estate investors to see through this temporary dip as he expects a sharp rebound and subsequent increases in rent prices. 

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This cyclical dip and surge present a strategic window for investors who can capitalize on the ebb to strengthen their portfolios before the expected surge. 

Amid these fluctuations, new listings have increased by 13% from 2023, while home sales have significantly dropped by 33% from 2022 levels. These dynamics unfold in an environment where mortgage rates have surged past 7% under the current administration, creating a challenging scenario for new homebuyers who rely on financing.

Cardone criticizes the federal response to interest rates and inflation, suggesting that these measures have disproportionately affected middle-class families, benefiting cash buyers like himself. He anticipates good deals for people positioned to buy homes outright without needing mortgage financing.

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Cardone's critique extends beyond real estate, touching on broader economic policies. He argues that until significant policy reforms are undertaken — such as reducing government spending, lowering taxes and reevaluating financial aid to other countries — the housing issues in the U.S. will intensify, leading to an increase in renters over homeowners. 

The median house payment, which currently exceeds $2,700 before considering other homeownership costs like insurance and property taxes, underscores financial pressures facing potential buyers. 

Cardone, with a portfolio of $5 billion in real estate investments, remains a staunch advocate for real estate as a fundamental asset class. His perspective is rooted in the belief that real estate offers value that can stabilize and grow wealth, a view encapsulated in his remark on X, "The real measure of your wealth is how much you'd be worth if you lost all your money." 

Through his insights, Cardone navigates the immediate market conditions and sets a broader discourse on wealth and investment in real estate as a long-term strategy. His predictions suggest a volatile, potentially lucrative future in real estate investment, particularly for those who can navigate the interplay of market trends, economic policies and investment timing.

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