For the most part, it’s been about one year now that the pandemic shell shocked the majority of US lives. March 2020 is likely a time carved deep into our memories where we collectively watched political, economic, and social trends unfold we’d never expected to encounter in our lifetimes. Thankfully, there are optimistic indicators we’re nearing a return to “normal” soon.
While this is encouraging, it’s not the only good news to hold to. Another factor is that multifamily investing performed throughout the pandemic as it is historically known to do: steadily. In fact, according to Globe St., as of March 2021 the Apartment Rent Index posted the “Largest Monthly Increase Since 2017”.
It’s no secret this asset is highly favored by many investors for the very fact that it has held to a precedence of being one of the most resilient investments available, and why in turn it is considered to be recession resistant. Throughout many turbulent cycles in time, it is multifamily assets that ultimately continue to cash flow, remain highly valued, and in demand.
However, the key to successful investing is not just selecting the right asset. The market and location will always remain a critical factor for how profitable an investment will be.
A recent report by ApartmentList.Com noted that there was, indeed, a direct correlation between the pandemic and how it impacted some of the most expensive cities in the US. Rent rates were forced down considerably as the pandemic acted as a catalyst for significant net migration trends, increased unemployment rates, and factors like which cities remained in shelter longer than others. Given this, yes, some markets were indeed impacted more than others.
One year later, how has it all played out? In comparing asking rent rates in various markets, from March of 2020 to March of 2021, we can see where the least and most impacted markets now stand.
The 5 Least Impacted Markets by Rent Rates Since COVID
5. Santa Ana, CA
Y/Y Change in 2 BR Rent Rates: 8.70%
M/M Change in 2 BR Rent Rates: 0.40%
Current Average Rent Rate: $2,380
Cumulative City-Wide COVID Cases (per state total): 7.24%