COVID Impact on Arlington’s Rental Market

Question: How has COVID impacted Arlington’s rental market?

Answer: Recent articles have shed light onto just how much COVID has hurt the apartment rental market in the DC Metro, including this article on rents dropping by 14% in Arlington and this article on rents in DC’s Class-A high-rise buildings dropping ~18%.

I have certainly experienced the difficult rental market in the last 10 months with clients who have struggled to find new tenants for their condos for months, even after significant price reductions. In some buildings, there are double-digit numbers of condos being offered for rent, with little interest.

I have also spoken to many condo owners who are turning to selling units after months of vacancy trying to rent them out, which is one of the reasons for last year’s explosion in condos listed for sale.

I took a look at last year’s rental market for apartments, townhouses, and single-family homes and compared it the previous four years to see how each sub-market performed. There’s a summary of key findings below and a detailed data table to follow.

Note that this only includes properties in Arlington that were rented through Bright MLS. Most commercial rental buildings do not use the MLS and not every homeowner with an investment property rents through the MLS, but the number of properties rented through the MLS is enough to make this statistically reliable data.

Key Findings

  • Condo rentals dropped in price for studios (-10.2%), one-bedrooms (-4%), and two-bedrooms (-1%). If you remove January and February (pre-COVID) listings, the price drops increase further. I suspect 2021 will see an even larger drop in rental prices because many owners are still trying to find a tenant.
  • The average time to rent a unit increased by 50% to two months and tenants negotiated significantly further below the asking price than ever before.
  • Two-bedroom units struggled, but not nearly as much as studios and one-bedrooms units, likely because the 2nd bedroom provides a much-needed home office.
  • COVID had the opposite effect on single-family and townhouse rentals with prices increasing to all-time highs, homes renting faster than ever before, and owners securing prices closer to their asking price than ever before.
  • Rentals of small two-and-three-bedroom houses and large four-bedroom townhouses were in the most demand, with average days on market just 3.5 weeks and some of the highest rental price to asking price ratios of any property type.
  • I expect single-family and townhouse rentals to have an even better 2021 (from the perspective of the homeowner) as people continue trying to get more space, avoid common living, and find buying those homes to be cost-prohibitive and/or too difficult (competitive).
Year ListedAvg RentAvg $/sqftAvg Rent $ to Ask $Avg Days on Market# Listed
Condo/Apartment
Studio
2016$1,409$3.0998.2%42113
2017$1,406$3.0298.7%45129
2018$1,434$3.2398.6%37123
2019$1,462$3.2598.5%31114
2020$1,313$3.0593.1%57146
One Bedroom
2016$1,783$2.3997.4%49553
2017$1,750$2.4497.5%58577
2018$1,886$2.5798.4%50572
2019$1,871$2.6398.1%36684
2020$1,797$2.4895.7%53579
Two Bedrooms
2016$2,519$2.2897.5%59494
2017$2,505$2.2897.3%63489
2018$2,605$2.3497.6%58471
2019$2,604$2.3797.8%46520
2020$2,576$2.3596.3%56469
Detached
Two Bedrooms
2016$2,339$1.9696.6%5658
2017$2,387$2.0097.0%4838
2018$2,435$2.0298.6%4054
2019$2,444$2.1896.8%4846
2020$2,456$2.1798.4%2759
Three Bedrooms
2016$3,030$1.7797.1%51177
2017$3,061$1.6997.5%51188
2018$3,108$1.8297.9%46172
2019$3,152$2.0797.1%35204
2020$3,299$2.1198.8%26182
Four Bedrooms
2016$3,518$1.5196.5%53128
2017$3,658$1.6297.9%46161
2018$3,665$1.7498.6%39149
2019$3,788$1.9296.9%41181
2020$3,883$1.9798.4%35155
Five Bedrooms
2016$4,528$1.2398.4%5645
2017$4,517$1.4598.1%4861
2018$4,553$1.5798.6%4153
2019$4,808$1.7697.2%4065
2020$4,873$1.7998.5%3563
Townhouse/Duplex
Two Bedrooms
2016$2,292$1.7697.7%58170
2017$2,342$1.7797.8%48163
2018$2,364$1.8998.3%39172
2019$2,390$2.0298.1%39213
2020$2,470$2.0898.2%29214
Three Bedrooms
2016$3,393$1.7997.4%60124
2017$3,395$1.8297.7%51156
2018$3,295$1.9198.5%43173
2019$3,378$2.0597.4%37173
2020$3,441$2.0697.1%34189
Four Bedrooms
2016$3,890$1.5698.3%4433
2017$4,051$1.7595.9%6530
2018$4,157$1.6898.6%5137
2019$4,090$1.9699.1%2739
2020$4,110$1.7199.1%2636

If you’d like to discuss buying, selling, investing, or renting, don’t hesitate to reach out to me at Eli@EliResidential.com.

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