Real Estate

Rent is dropping across the country

Cuts in some metros are double the U.S. average

The economic effects of the COVID-19 pandemic continue to influence rent prices across the country.

California is seeing rents decrease in several areas. According to RealPage, operators in Los Angeles cut rents by 3.3% in May 2020 compared to May 2019. Oakland, California saw an annual loss in effective asking rents of about 3% in May. Bigger cuts were seen in San Jose at 4.4% and in San Francisco at 4.9%, RealPage said.

In New York, where housing courts recently opened and evictions can resume, the Rent Guidelines Board voted to approve a rent freeze on one-year leases, according to Curbed New York. For two-year leases, there is a freeze in the first year and a 1% increase in the second year.

As of June 13, the National Multifamily Housing Council said that 89% of renters in professionally managed apartments had paid rent across the U.S.

Of those who paid rent, 84% of the residents living in lower-priced Class C properties paid rent in total, compared to the collection rates of 90.3% to 90.4% in luxury Class A projects and middle-market Class B communities, RealPage said.

Asking prices have also dropped. For the first time since the middle of 2010, there’s a decline of 0.5% in effective asking rents between May 2019 and May 2020.

Executed new lease rent has dropped at least 8%, which is double the norm in the U.S., in Boston, Detroit, New York, Salt Lake City, San Francisco and San Jose, California.

In San Francisco, one-bedroom rents have dropped 9.2% since June 2019, according to SFGate. Boston has felt the impact from universities and colleges being out, as about 65,000 students live off-campus, the Boston Globe said, and rent is down 2%.

Leave a comment

Latest Articles

[PULSE] How to manage rental properties during a global crisis

As the current U.S. unemployment rate hovers above Great Depression-Era levels, many property owners are having rent delinquency, leasing and management issues. So, what can an investor do during the current economic situation to protect their asset?

Jul 02, 2020 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please