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 Listed | Avg Rent | Avg $/sqft | Avg Rent $ to Ask $ | Avg Days on Market | # Listed |
| Condo/Apartment | |||||
| Studio | |||||
| 2016 | $1,409 | $3.09 | 98.2% | 42 | 113 |
| 2017 | $1,406 | $3.02 | 98.7% | 45 | 129 |
| 2018 | $1,434 | $3.23 | 98.6% | 37 | 123 |
| 2019 | $1,462 | $3.25 | 98.5% | 31 | 114 |
| 2020 | $1,313 | $3.05 | 93.1% | 57 | 146 |
| One Bedroom | |||||
| 2016 | $1,783 | $2.39 | 97.4% | 49 | 553 |
| 2017 | $1,750 | $2.44 | 97.5% | 58 | 577 |
| 2018 | $1,886 | $2.57 | 98.4% | 50 | 572 |
| 2019 | $1,871 | $2.63 | 98.1% | 36 | 684 |
| 2020 | $1,797 | $2.48 | 95.7% | 53 | 579 |
| Two Bedrooms | |||||
| 2016 | $2,519 | $2.28 | 97.5% | 59 | 494 |
| 2017 | $2,505 | $2.28 | 97.3% | 63 | 489 |
| 2018 | $2,605 | $2.34 | 97.6% | 58 | 471 |
| 2019 | $2,604 | $2.37 | 97.8% | 46 | 520 |
| 2020 | $2,576 | $2.35 | 96.3% | 56 | 469 |
| Detached | |||||
| Two Bedrooms | |||||
| 2016 | $2,339 | $1.96 | 96.6% | 56 | 58 |
| 2017 | $2,387 | $2.00 | 97.0% | 48 | 38 |
| 2018 | $2,435 | $2.02 | 98.6% | 40 | 54 |
| 2019 | $2,444 | $2.18 | 96.8% | 48 | 46 |
| 2020 | $2,456 | $2.17 | 98.4% | 27 | 59 |
| Three Bedrooms | |||||
| 2016 | $3,030 | $1.77 | 97.1% | 51 | 177 |
| 2017 | $3,061 | $1.69 | 97.5% | 51 | 188 |
| 2018 | $3,108 | $1.82 | 97.9% | 46 | 172 |
| 2019 | $3,152 | $2.07 | 97.1% | 35 | 204 |
| 2020 | $3,299 | $2.11 | 98.8% | 26 | 182 |
| Four Bedrooms | |||||
| 2016 | $3,518 | $1.51 | 96.5% | 53 | 128 |
| 2017 | $3,658 | $1.62 | 97.9% | 46 | 161 |
| 2018 | $3,665 | $1.74 | 98.6% | 39 | 149 |
| 2019 | $3,788 | $1.92 | 96.9% | 41 | 181 |
| 2020 | $3,883 | $1.97 | 98.4% | 35 | 155 |
| Five Bedrooms | |||||
| 2016 | $4,528 | $1.23 | 98.4% | 56 | 45 |
| 2017 | $4,517 | $1.45 | 98.1% | 48 | 61 |
| 2018 | $4,553 | $1.57 | 98.6% | 41 | 53 |
| 2019 | $4,808 | $1.76 | 97.2% | 40 | 65 |
| 2020 | $4,873 | $1.79 | 98.5% | 35 | 63 |
| Townhouse/Duplex | |||||
| Two Bedrooms | |||||
| 2016 | $2,292 | $1.76 | 97.7% | 58 | 170 |
| 2017 | $2,342 | $1.77 | 97.8% | 48 | 163 |
| 2018 | $2,364 | $1.89 | 98.3% | 39 | 172 |
| 2019 | $2,390 | $2.02 | 98.1% | 39 | 213 |
| 2020 | $2,470 | $2.08 | 98.2% | 29 | 214 |
| Three Bedrooms | |||||
| 2016 | $3,393 | $1.79 | 97.4% | 60 | 124 |
| 2017 | $3,395 | $1.82 | 97.7% | 51 | 156 |
| 2018 | $3,295 | $1.91 | 98.5% | 43 | 173 |
| 2019 | $3,378 | $2.05 | 97.4% | 37 | 173 |
| 2020 | $3,441 | $2.06 | 97.1% | 34 | 189 |
| Four Bedrooms | |||||
| 2016 | $3,890 | $1.56 | 98.3% | 44 | 33 |
| 2017 | $4,051 | $1.75 | 95.9% | 65 | 30 |
| 2018 | $4,157 | $1.68 | 98.6% | 51 | 37 |
| 2019 | $4,090 | $1.96 | 99.1% | 27 | 39 |
| 2020 | $4,110 | $1.71 | 99.1% | 26 | 36 |
If you’d like to discuss buying, selling, investing, or renting, don’t hesitate to reach out to me at Eli@EliResidential.com.