The COVID-19 pandemic upended the D.C.-area apartment rental market. As financially impacted renters moved back home, or doubled or tripled up with friends, vacancies soared and rental rates tumbled. But renters have returned, and D.C. is one of the top mega-hubs to brush off worries of fleeing renters.
Among the nation’s top metro areas, the D.C. area ranks No. 5 for increase in overall rental activity in the first half of 2021, up 41% from the first six months of 2020, according to real estate data and research firm Yardi Matrix.
D.C. trailed only New York City, San Francisco, Seattle and San Jose for an increase in rental activity during the first six months of the year.
A lot of those new renters in the D.C. area are young adults under 25 years old. Rental applications by Gen Z adults are up 92% from the same time last year.
“They are entering the rental market in droves,” said Doug Ressler, manager of business intelligence at Yardi Matrix. “They are coming out of homes, and coming out of schools. Certainly pricing has created a situation where ‘fresh outs’ or entry-level workers can afford pretty comfortable living conditions.”
While average apartment asking rents in the D.C. metro showed year-over-year monthly declines through much of the pandemic, rents began stabilizing this spring. But the average rental rate still remains lower than year-ago levels, helping revive rental activity here.
“They’re really looking for better deals. It could be D.C. or it could be New York. It seems to be that consumer behavior is driving the migration and the re-occupying of rental properties,” Ressler said.
He said the pandemic created an opportunity for renters to get out and try to find a better deal, whether it’s a larger apartment, a better neighborhood or the ability to finally rent without roommates in D.C.
The D.C. area continues to benefit from a stronger job market than many other large areas. Yardi Matrix data shows the strongest growth among apartment applications in the first half of 2021 were among those earning between $50,000 and $75,000, up 62% from the same period a year ago.
And those jobs are attracting people to the region.
In the first six months of 2021, 65% of apartment rental applications came from people outside of the region.
Nationwide, rental activity in the first six months of 2021 was up 13% from a year earlier. People earning more than $100,000 were the most active, up 34% from last year. Rental applications rose compared to year-ago levels in all of the nation’s 30 largest cities.
Yardi Matrix ’s report is based on 2.5 million rental applications during the first half of 2021 and 2020. Its full rental activity report covering 30 metro areas in the U.S. is posted online.
Below is a graph of year-over-year rental activity changes in the 20 metro areas Yardi Matrix included in its report:
