Rents were up another 2.1 percent nationally in August as rent growth continued, while vacancies reached historic lows, according to the latest report from Apartment List.
The report says that since January of 2021, the national median rent “has increased by a staggering 13.8 percent. To put that in context, rent growth from January to August averaged just 3.6 percent in the pre-pandemic years from 2017-2019.”
Rent growth in 2021 so far is outpacing pre-pandemic averages in 98 of the nation’s 100 largest cities, and only a few cities remain cheaper than they were pre-pandemic.
For example, San Francisco rents are still 12 percent lower than they were in March 2020, but rent prices have gone up 20 percent since January. Many mid-sized markets that have seen rents grow rapidly through the pandemic are only continuing to boom. For example, rents in Boise are now up 39 percent since March 2020.
Apartment vacancies reach historic lows
The tight housing market with few homes available to purchase has led many renters to have to stay where they are.
“As would-be home buyers get priced out of the for-sale market, they continue to rent. This high demand has created a tight market, resulting in our vacancy index dropping sharply throughout 2021 as prices increase rapidly.”
Few cities remain below pre-pandemic rent levels.
Some of the cities that saw dramatic pandemic-era rent drops, such as New York and Los Angeles, are finally back to pre-pandemic prices.
“That means that, ‘pandemic pricing’ is over in most of the country. Rents remain below pre-pandemic levels in just eight large cities: four California cities in the San Francisco Bay Area (San Francisco, Oakland, San Jose, and Fremont); Minneapolis, MN; Washington, DC; Seattle, WA; and Jersey City, NJ.”
2021: Fastest rent growth on record
Following the pandemic rent prices last year, “2021 has brought the fastest rent growth we have on record in our data,” Apartment List said in the report.
“As prices rebound rapidly even in the cities that saw the sharpest declines last year, there are very few cities remaining where rents have yet to surpass pre-pandemic levels. As we approach the winter, a seasonal slowdown in the rental market should relieve some of this pressure, but with historically low apartment vacancies and growing household mobility, a winter cooldown is unlikely to reverse much of the dramatic price growth we’ve measured throughout the year.”