Urban multifamily properties will rebound in 2021
The outlook for the apartment sector has taken a positive turn, with effective rents expected to return to near pre-pandemic levels in 2022, forecasted Moody’s Analytics CRE Solutions.
National average effective rents fell a record 3.0 percent in 2020 and are now forecast to rise by 2.1 percent in 2021. Multifamily markets in dense urban areas such as New York, the San Francisco Bay Area, and Washington, D.C., were particularly affected by the pandemic but have likely hit their rent low points and begun to recover. Meanwhile, vacancy rates across the United States are expected to stabilize this year, staying at a national average of 5.2 percent.
“We anticipate that the combination of returnees and first-time movers, now attracted by lower rents, will be enough to stabilize the apartment sector in key urban centers,” said Thomas LaSalvia, senior CRE economist at Moody’s Analytics, “However, the office sector in these areas still has a ways to go before recover