The rate at which the current growth rates of lease of apartments in the US is “heated” and all concerned data arriving from the US real estate market on the lease of apartments from the previous two months show no signs of the usual seasonal decline at this time of year, after peaking in early summer when the renewal of numerous leases came due, Bloomberg writes.
Zillow Group Inc. the index, which is based on the average value of listed rents, increased by 11.5 percent in August compared to the previous year, while in some cities in Florida, Georgia and Washington, the jump was higher than 25 percent.
In New York specifically, as shown by statistics, the price of the lease of apartments in the US in August jumped by 11.5 percent compared to the previous year, or nearly $200.
– The double-digit increase in rent prices for a year and a half is a shocking level of growth, especially if we take into account that the largest growth occurred in the past nine months – it is stated in the report of Zumper National Rent.
Effects Of COVID-19 On Real Estate
Since the beginning of the pandemic, the average rent for a two-bedroom apartment, according to Bloomberg, has increased by 13.1 percent and now amounts to 1,663 dollars.
When it comes to the market in New York, landlords have raised the price of rent by up to 70 percent. This is happening at the moment when people rush back to the city, as the measures against kovid were relaxed and offices were opened, as well as places to conduct. So in July, the average rent jumped to $3,000, compared to a record low of $2,750 in January this year, StreetEasy data show.
There are some indications that price growth is easing, especially in the cities that have shown the biggest jump. In the city of Boise, Idaho, where prices have jumped the most since the start of the pandemic, they have fallen slightly this month compared to August, according to data from the Apartment List database.
Another indicator that rents could start to stabilize is the index of this base, which increased in August for the first time since last April. However, rents continued to jump month after month, at the time of year when they usually start to fall, as the company announced in its monthly report.
Inflation will remain
Another firm that monitors the price of rent, Yardi, revealed that the national jump in rent prices from year to year was 10.3 percent in August, which is “the first double-digit jump in their index.” Yet, as Yardi reported, the annual jump could be deceiving in a number of urban areas that were at their lowest point a year ago, when people fled cities due to the spread of the kovid 19 virus.
In the long run, Bloomberg writes, even though such rent increases discounts in the coming months, inflation will remain. The Dallas Federal Reserve predicts that the official rent index of the Bureau of Labor Statistics will increase to 6.9 percent by the end of 2023, which will be the biggest jump in more than 30 years.
However, as it is stated, it is not just about renting apartments on the real estate market in the USA. House prices for one family jumped by almost 20 percent in July compared to last year, which is the biggest jump in more than three decades. This is too expensive for many buyers who are trying to afford their first apartment, which is shown by the fact that this group accounted for only 29% of all real estate sales in August, which is the lowest value since January 2019.