The Covid-19 pandemic threw Washington DC’s real estate market into a tailspin. As tens of thousands of people lost their jobs, we saw substantial vacancy spikes after financially affected people fled the U.S capital.
Now that the economy seems to be recovering and businesses are reopening, what does Washington DC’s rental property market look like? Keep reading to find out.
Rental Activity Is Up By Over 40%
“Finally, the DC’s rental property market is striving once again,” says Jay Patenaude, Property Manager at Keener Management. Since February, Keneer’s properties have seen an average of 10 to 12 showings per week, with at least four leases signed from those showings.
According to a post-Covid-19 market report by Bloomberg, the overall rental activity has grown by more than 40% in the nation’s capital. With pandemic concerns waning, renters are slowly returning and apartment rentals in DC Metro are starting to rent faster.
To put it in a more practical context, in January 2022 alone, Bright MLS rented more than 36 single-family homes with two bedrooms in D.C. Over the past two weeks, at least 240 of them were rented, representing a 6.2% increase in demand since the pandemic ceased. A substantial number of tenants in DC are Gen Z renters (individuals in their early 30’s).
Median Rental Prices Are Rising, Again
Thanks to the pandemic, some renters fled their apartments in droves, others opted to downsize to cheaper units. That drove vacancy rates higher, resulting in significantly lower rental rates than ever witnessed in DC since the global financial crisis of 2008. Average DC area rents fell as much as 15% in the first few months into the pandemic.
With financial situations improving, the exact opposite is now being witnessed in the DC area market. Vacant apartments in Washington DC are becoming increasingly scarce, and the median rental prices here are up by over 12.06% just since January 2022, reflecting a dramatically faster growth than during pre-pandemic months.
“The number of households in the DC metro area now is actually higher than the pre-pandemic peak, so that contraction that we saw in the past year did reverse itself quite rapidly,” said Chris Salviati, housing economist at Apartment List, a popular rental search site.
Below is a quick breakdown of the average rent in Washington DC:
- Studio apartment – $1,891
- 1-bedroom apartment – $2,444
- 2-bedroom apartment – $3,430
- 3-bedroom apartment – $4,384
Rental Incentives Are Quickly Fading Away
The perks given to renters during the pandemic are quickly becoming a thing of the past. To cushion renters from the impacts of Covid-19, rental communities had put up incentives such as waived move-in fees, deals on parking, three months off rents and more.
As properties that remained vacant for months are starting to fill up again, costs to rent are taking an upward trajectory, and a lot of deals and incentives are being scraped. With that said, the Washington DC market is packed with diverse and eclectic neighborhoods, and there are still some good deals to be found in many locations.
If you are looking for a rent special, you might want to try Washington DC neighborhoods like Adams Morgan, Trinidad and Hillcrest. You could still find great perks such as free parking, waived amenity fees, waived pet fees and more. Make sure to ask if the fee is annual or a one-time cost.
The Rental Market Policies And Procedures Are Changing
Due to the impacts of the Covid-19 pandemic and the widespread economic fallout, the federal government had enacted various laws governing the conduct of landlords and tenants, such as:
- Eviction moratoriums (evictions for non-payments were paused)
- Temporary waiver of late payment fees
- Repayment agreements (rent could be paid to the landlord at a later date)
- Illegal lockout lawsuits (the landlord could be sued for illegally locking out a tenant without first undergoing the court systems)
Now that the “new normal” seems to be coming to an end, the rental market policies and properties are changing. Most property management companies have tightened standards for new tenants to ensure the applicant has a steady job to pay the rental fees.
What’s Ahead For DC’s Rental Market?
The Washington DC rental market is quickly recovering from the Covid-19 spike and now offers many opportunities for prospective renters. However, before you start moving, it’s vital to understand the cost of living in the nation’s capital.
Whether you’re looking to rent a single-family home or a multi-family building, make sure to come up with an accurate budget that caters for everything, from your rent payment and regular expenses to your Netflix subscription and utilities. From there, you’ll be all set to find your dream DC apartment befitting for your budget. Good luck!