The COVID-19 pandemic has radically reshaped the economy, including the rental market. Some people have struggled to pay rent during the pandemic, and many landlords have faced challenges finding new tenants who can afford the rent. Weirdly, there’s a silver lining in all this: Many landlords have had to lower their rents to make ends meet.
Given these changes, paying attention to current rental market trends can help you find a top-notch apartment rental that might normally fall outside your budget. Here are some details on how COVID-19 has affected rent prices and what this might mean for your move.
Where average rents have decreased
Average rent prices have decreased in several parts of America since, during the early stages of the pandemic, Americans were told to avoid moving. National rent prices thus dropped during summer 2020, which is unusual. The summer is usually a busy season (often known as the summer rush) when rents typically increase.
Expensive coastal cities have seen the largest declines in average rent prices during the pandemic. San Francisco, the most-expensive and most-impacted city in the country, has experienced an average rent decline of 26.7 percent since March 2020. Some heavily-populated cities such as Seattle, Boston, New York, Chicago, and Minneapolis, have experienced similar patterns.
Where average rents have increased
Despite some cities experiencing a drop in average rental prices, some parts of these cities have experienced rent increases, as have midwestern and Sun Belt cities. For example, the low-income parts of New York hit hardest by COVID-19, experienced an increase in rent prices. Some experts attribute this rent increase to the fact that, often, neighborhoods with lower median rent prices usually grow faster than higher-priced neighborhoods due to gentrification.
Additionally, some midwestern and Sun Belt cities are experiencing higher rental prices because many people have moved there from more-expensive cities. Rental prices have risen in Memphis, Phoenix, Riverside, Indianapolis, and Columbus.
The national picture
Many people who can afford to move have moved from bigger cities to smaller cities or rural areas. This shift is partially due to remote workers moving closer to their families and wanting to save money. After COVID-19 caused a historic wave of layoffs, many renters could not afford to live in expensive cities. In general, rentals in urban areas have slowed down more than rentals in non-urban areas.
Experts believe that remote workers who are renting and buying homes in the suburbs are affecting the demand for leases in cities. As a result, many landlords have been more open to offering concessions on rentals as opposed to decreasing rent prices. Housing experts often say that offering concessions is better than cutting rental prices because decreasing rent prices can go back up after the pandemic.
What does this all mean?
With rental prices down in some areas, now might be a good time to get that apartment you couldn’t previously afford. You might even be able to move into a new city you couldn’t previously afford. Plus, since the COVID-19 pandemic isn’t over yet, you’ll likely be at home often—and with smart budgeting decisions, now might be the time to get the exact apartment you want and can newly afford.