Median apartment-rental rates across Arlington continue their post-COVID rebound and are the highest in the Washington region, but the rate of growth over the past month was slightly below the national average.
With a median cost of $2,061 for a one-bedroom apartment and $2,495 for a two-bedroom unit, the median price for Arlington rentals over the preceding month was up 1.9 percent, according to data reported Sept. 27 by Apartment List.
That compares to a national month-over-month increase of 2.1 percent (to $1,032), with Arlington seeing the 56th highest rate of growth among the 100 largest urban localities in the nation.
(See the full report at https://www.apartmentlist.com/research/national-rent-data.)
Like many urban areas, Arlington took a COVID hit when it came to apartment-rental rates starting in the spring of 2020. But this past January, that had begun to turn around in the county, and since then Arlington has seen a 12.3-percent rise in median prices – slightly below the statewide increase of 12.5 percent though more significantly lower than the national increase of 15.1 percent during the same period.
In other parts of the metro area:
• Frederick has seen the fastest rent growth, with a year-over-year increase of 17.4 percent. The median two-bedroom there costs $1,877, while one-bedrooms go for $1,554.
• Over the past year, Bethesda is the only urban corridor in the metro that has seen rents fall, with a decline of 0.1 percent. Median two-bedrooms there cost $2,138, while one-bedrooms go for $1,746.
• D.C. proper has the least expensive rents in the metro area, with a two-bedroom median of $1,837; rents increased 1.7 percent over the past month and 6.9 percent over the past year.
• Want someplace close(ish) but much cheaper? Consider Norfolk, where the median price of a two-bedroom apartment clocked in at $1,191 in the most recent data.
Nationally, there are signs that explosive price growth could soon be transitioning back to a more normal, seasonal state of affairs. But the market remains hot.
“Rent growth has cooled slightly from its July peak, but we’re still seeing significant price gains at a time when seasonality in the market normally causes a dip in rents,” noted Apartment List analysts Chris Salvati, Igor Popov, Rob Warnock and Lilla Szini.
“Rents are still increasing in nearly all of the nation’s 100 largest cities,” the analysts noted. “Among the 100 largest cities, there are now just five remaining where rents are still below pre-pandemic levels.”
Those five? In addition to the District of Columbia (with its median price off just 1 percent from the start of the pandemic), they include San Francisco and Oakland (each still down 10 percent), San Jose (off 3 percent) and Minneapolis (down 5 percent). One large city – Seattle – bumped over its pre-pandemic level during the month, taking it off that list.
Twenty-two of the top 100 urban areas have see rents up by at least 25 percent over pre-pandemic rates. The urban areas that have seen the biggest growth rates: Boise (up 39 percent), Tampa (36 percent) and Spokane (34 percent). But in a sign that all good things (if you are a property owner) come to an end, both Boise and Spokane saw declines in September from a month before.
“It appears that they may have hit their peaks,” analysts said. “However, Boise and Spokane represent the exception rather than the rule – in most of the cities where rents had been growing quickly, that growth is continuing. Tampa, for example, saw rents jump by another 3.9 percent this month.”
Much of this year’s boom in rent prices can be attributed to a tight market in which more and more households are competing for fewer and fewer vacant units.
The Apartment List vacancy index spiked to 7.1 percent at the start of the pandemic, as many Americans moved in with family or friends amid the uncertainty and economic disruption of the pandemic’s onset. Since then, however, vacancies have been steadily declining. For the past several months, the “vacancy index” has been hovering just below 4 percent, significantly lower than the 6 percent rate that was typical pre-pandemic.
This month, however, the vacancy index ticked up slightly, from 3.8 percent to 3.9 percent. While a statistically insignificant increase, it represents the first jump of any magnitude since last April.
“We’ll need to see more data to confirm if this trend will continue, but if vacancies are back on the rise again, it would signal that tightness in the rental market is finally beginning to ease,” analysts said. “If our vacancy rate continues to increase in the coming months, it’s likely that rent growth will also continue to cool.”