Coronavirus Pandemic Pushes Asking Rent Prices Down
New data show the pandemic’s impact on the apartment rental industry.
During the second quarter of 2020, the median asking price for a new unfurnished, unsubsidized apartment dropped six percent compared to the same time last year. In 2019 it was $1,640 and in 2020 it was $1,543.
The National Association of Homebuilders says the pandemic has pushed millions into unemployment, discouraging renter mobility and putting downward pressure on rents for new units. Absorption rates increased five percent in the second quarter with 60% of new apartments being rented within three months of going on the market.
The Arizona Multihousing Association said the Valley was expected to add 9,700 units in 2020. According to the group’s November/December publication, downtown Phoenix accounts for 4,600 new apartments and Gilbert for 1,800 units.
The homebuilders association also examined the U.S. Census Bureau’s Survey of Market Absorption when it comes to condominiums. It found condo absorption increased to 61% in the second quarter of 2020 compared to 54% during same time frame in 2019. Condo completions dropped significantly. Going into the second quarter of 2019 it was 7,285 compared to 2,497 going into the second quarter of 2020.