Apartment rents rise as young workers return to cities
Apartment rents are rising rapidly, spurred by the return of young professionals to the city and an expensive housing market that keeps many of them rented.
Stock prices of publicly traded apartment companies surged in the process. The FTSE Nareit Equity Apartments Index, which tracks these owners, is up 42% since January, beating the S&P 500’s 17% gain over the same period.
The median rent has risen by more than 10% in the past year, according to the apartment search website Apartment List, reflecting how soaring house prices are forcing many potential buyers out of the housing market. sale. In June, median selling prices for existing homes were up 23.4% from the previous year to a record $ 363,300, according to the National Association of Realtors.
The job losses at the start of the pandemic first affected the collection of rents. Occupancy rates have hit new lows for some homeowners. Major markets like New York and San Francisco saw double-digit declines in asking rents, pushing apartment stock prices down.
Some affordable homeowners or low-income renters, meanwhile, struggled to collect rent during the nearly year-long ban on eviction that ended over the weekend.