Key Highlights
- National rent index down -0.3% since March
- Year-over-tear rental growth stands at +0.2%
- Normally peak season of rental growth from March-June…not this year
- Rent changes vary by locations
The COVID-19 pandemic and its economic impacts have completely upended the nation’s prime season for rental activity just as the pandemic essentially turned springtime’s prime home buying season into summer. This year, beginning in March when the pandemic outbreak spawned in the US, we’ve seen three consecutive months of rental growth slippage, down by -0.3%, to the point that now, according to latest research by ApartmentList, year-over-year rental growth now stands at just 0.2%.
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Like everything else in real estate, rental growth changes vary by location. The most expensive rental markets and the markets most dependent upon tourism, such as San Francisco, Orlando, New York City, San Jose and Miami, have experienced rent declines of -1.7% and more in just three months.
ApartmentList indicates that this decline in rent is “by far” the lowest y/y growth rate in any month of June over any of the past five years. Take a look:
- San Francisco has seen rents fall by -02.2% from May
- San Jose – -2.1%
- Santa Clara County – -1.6%
- San Mateo County – -1.2%
- Alameda County – -0.9%
- Contra Costa County – -0.4%
- Solano County – -0.7%
- Orlando – -2.2%
- Miami – -1.7%
- Henderson NV – -2.1%
Pandemic rental pricing at the high end of the rental market in New York City is seeing prices down by -10%, according to Miller Samuel and Douglas Elliman, whereas the median rent for all Manhattan apartments was down -3% from April to May.
According to CoreLogic, Phoenix had the highest y/y rent growth in April with an increase of +6.6%. Tucson’s rent growth rate hit +3.7% y/y and Charlotte’ s rent growth rate y/y came in at +3.4% in April. St. Louis, the only outlier to experience an annual decline in rent, showed a decrease of -4% lower than in April 2019.
Zumper has seen median rents in the country’s four most expensive cities, San Francisco, New York, Boston and San Jose, all drop between -6 – -10%. In higher-end luxury units, rental hits are down between -10% and 20%.
Obviously, now is the time for renters who have attachments to the cities in which they live to negotiate better, more advantageous leases.
Thanks to ApartmentList, Miller Samuel, Douglass Elliman, CoreLogic and Zumper.
Also read: Home Price Growth in San Francisco Hits the Wall, How Many Work Hours Needed to Pay Rent in 25 Largest US Cities?, Top Zip Codes with Highest Equity Rich Shares & Underwater Properties in Q4 2019
