Arlington and the nation seem to be moving back to normal seasonal trends in apartment rents, according to new data, after a roller-coaster ride that started with the onset of the pandemic nearly two years ago.
Arlington’s average apartment-rental rates declined 0.4 percent from December to January, compared to a national increase of 0.2 percent, according to data reported Jan. 26 by Apartment List.
The average rental rate in Arlington for the month was $1,980 for a one-bedroom unit and $2,396 for a two-bedroom abode.
More than 40 of the nation’s largest urban areas saw rents fall in January, while just five saw increases of more than 1 percent. That may be a sign that markets are stabilizing, as the rental market traditionally is more dormant during the winter months.
“Even though month-over-month growth has moved back into positive territory, [it] has still cooled substantially from last year’s peak,” noted Apartment List analysts Chris Salvati, Igor Popov, Rob Warnock and Lilla Szini.
“Year-over-year rent growth currently stands at a record-setting 17.8 percent, but over the past four months, rents have increased by a total of just 0.9 percent,” the analysts noted. “Much of this cooldown is likely related to seasonal factors; it remains to be seen if rapid rent growth will return as moving activity picks back up in the spring and summer.”
(For complete data, see the Website at https://www.apartmentlist.com/research/national-rent-data.)
While Arlington’s rental market dipped from December to January, it remains up 16.7 percent year-over-year, and above pre-pandemic levels.
For the 12 months ending in September, New York City recorded the largest increase in rental rates, up a whopping 33.5 percent. That made up for the significant declines that occurred during the early days of the pandemic and the government shutdowns that followed; the Big Apple is now up 4.4 percent compared to pre-pandemic levels.
Not far behind New York in year-over-year increases are Tampa (31.4 percent), Scottsdale, Ariz. (31.1 percent) and Orlando (30.1 percent), each of which saw little downward pressure on rents during the early stages of the pandemic. As a result, Tampa’s average apartment-rental rate is now about 35 percent higher than it was before the start of the COVID crisis.
None of the 100 largest urban markets posted a year-over-year decline in January, but Oakland saw the lowest increase, at 0.5 percent. Detroit was second from the bottom, at 2.6 percent.
Where is the rental market headed? “It’s likely that rent growth will pick back up in the coming months, though it’s still unclear just how much we should expect rents to rise in the year ahead,” the Apartment List analysts said.
January’s national apartment-vacancy rate of 4.4 percent, while historically low, marks the fifth straight month of increase since the rate bottomed out at 3.8 percent last August.
“Although the recent vacancy increase has been modest and gradual, it represents an important inflection point, signaling that tightness in the rental market is finally beginning to ease,” analysts noted. “The vacancy situation remains historically tight, but the gradual easing of recent months has likely been contributing to the slowdown in rent growth.”
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