After falling 13 percent in 2020 as the pandemic roared in, median apartment rents in Arlington were up a tidy 16.8 percent in 2021, according to new data, leaving renters paying more now than they did before the COVID crisis started.
With median rents of $1,989 for one-bedroom units and $2,408 for two-bedroom apartments, Arlington’s rental rates at the end of 2021 were up 0.8 percent from before the pandemic, according to data reported Jan. 6 by Apartment List.
The monthly data track apartment-rental rates in the nation’s 100 largest urban areas. Across the U.S., median rents rose 17.8 percent in 2021 to stand at $1,309. That’s off the charts compared to appreciation rates in recent “normal” years: 3.2 percent in 2018 and 2.2 percent in 2019.
But 2022 is starting with a cooldown.
“Although many renters may be rightfully dismayed by last year’s record-setting rent growth, the new year is bringing with it a bit of relief. Our national rent index actually fell by 0.2 percent in December, making it the only month of 2021 in which rents declined,” analysts Chris Salvati, Igor Popov, Rob Warnock and Lilla Szini noted. “December also marked the fifth straight month in which monthly rent growth has slowed, after peaking at 2.7 percent in July.”
In all, 61 of the 100 largest markets saw median rents fall from November to December. (See the full data at https://www.apartmentlist.com/research/national-rent-data.)
Riverside, Calif., saw the largest month-over-month decline, at 3.1 percent, with cities like Seattle (down 2.9 percent), San Francisco (off 1.6 percent) and Chicago (down 1 percent) also seeing declines.
Prices have dropped for three consecutive months in some of the smaller cities that saw massive influxes of new residents throughout the pandemic, including Boise (Idaho), Fresno (Calif.) and Reno (Nev.). Meanwhile, rent increases have persisted in warm-weather cities across the Sun Belt, like Orlando, Tucson and Dallas, where rent growth decelerated but remained positive throughout the last several months of 2021.
On a year-over-year basis, the two biggest increases in rents for 2021 were seen in New York City (up 32.8 percent) and Tampa (32.6 percent). But those increases came for very different reasons.
“What differentiates New York City from most other cities at the top of this list is the local market conditions going into 2021,” analysts noted.
“The apartment market in Tampa, for example, experienced only a brief setback from the pandemic. There, prices rebounded quickly in the second half of 2020 and that growth continued throughout 2021. But in New York City, 2020 was characterized by deep price cuts as demand shifted away from dense urban centers for several months.”
“While 2021 increases in Tampa were pushing prices to never-before-seen highs, 2021 increases in New York were largely making up for losses experienced the year before,” the analysts noted.
Only one city (Oakland) saw a year-over-year decline in December, being down 1 percent. More than 80 of the 100 ranked communities posted a year-over-year growth rate of more than 10 percent for the month.
After bottoming out at 3.8 percent in August 2021, the Apartment List vacancy index has ticked up slightly for four consecutive months and stood at 4.3 percent at the end of the year.
“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. “If our vacancy rate continues this trend in the coming months, it’s likely that rent growth will also continue to cool.”