In inflationary times, what type of lease arrangement would a property manager prefer to avoid?

In inflationary times, property managers generally prefer to avoid leases with a fixed rental rate. This is because such arrangements do not allow for adjustments in rent to keep pace with rising costs due to inflation. When inflation occurs, the purchasing power of money decreases, which means that the fixed rent amount may not adequately reflect the current market value of the property or the costs associated with managing and maintaining it. A fixed rental rate can lead to decreased profitability for property managers if expenses increase while rental income remains stagnant. In contrast, lease agreements that include graduated increases, tie rents to a consumer price index, or a cost-of-living index allow for adjustments in rent that can help maintain the financial stability of the property during inflationary periods.