The recently released U.S. Census Bureau’s Survey of Market Absorption (SOMA) reveal that the absorption rate of unfurnished, unsubsidized apartments (the share rented out in the first three months following completion) moved up to 60% in Q2 of 2020, up from 55% in Q2 of 2019. The number of apartments completed fell from 68,140 units in Q2 of 2019 to 64,360 units Q2 of 2020, which was a -6% drop. While the apartment absorption remained fairly steady, the median asking rent price of these apartments fell by -6% to $1,543 in Q2 of 2020, down from $1,640 in Q2 of 2019. This marks the first year-over-year decline in the median asking rent price since the Q1 of 2019. The coronavirus pandemic has pushed millions into unemployment and discouraged renter mobility and the formation of new renter households, which has put downward pressure on rents for new apartments.
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Apartment Absorption Steady but Rent Prices Fall