Folks like us in the rental property business are always looking for the next big trends. We generally like to think that our predictions are correct more often than not. That being said, we’ll be the first to admit that 2020 threw more than a few surprises our way.
The effects of the COVID-19 pandemic on the real estate and rental property industries could never have been foreseen, and they will continue to be felt for years to come. With that in mind, we can make some highly educated predictions about the biggest rental property trends of 2021.
Top Rental Property Trends 2021
The overall market has stabilized
After a rollercoaster year, some of the best news for the rental property market in 2021 is that it will, overall, stabilize and become less volatile. Rental apartment prices are on track to stay relatively flat, at least through the first half of the year, which has a lot to do with large numbers of people who are still out of work because to the pandemic.
Still, overall occupancy rates have remained high, which suggests a sustainable rebound in rental prices in the back half of 2021. Don’t expect rental rates to grow by leaps and bounds, but look for a slow and steady increase.
The suburbs will level out
2020 saw a huge boom in rental properties in suburban areas, as many renters left inner cities. This shift was driven in part by the relatively low cost of living and high quality of life in these areas, but it was also fueled by the pandemic, which quashed many of the advantages of city life. Why live in the city when you can’t go out and especially when you are working from home?
We expect the growth in suburban rental markets to level off and possibly even decline slightly as 2021 wears on and life returns to somewhat normal. Many renters will end their leases and return to the city as the pandemic subsides; but look for another uptick in the suburbs when 2022 rolls around.
A spike in student rentals
More and more colleges will return to offering in-person classes for the fall 2021 semester. This return to normalcy will give a boost to rental markets in college towns, and college-adjacent areas of major cities. It’s likely that students will prefer off-campus housing more than ever this fall, which should be great for owners of rental property near college campuses like Western Washington University in Bellingham.
Unpredictability in vacation rentals
Families have traditionally planned trips to certain parts of the country during particular times of the year. This has always made the seasonal ebbs and flows in the demand for vacation rentals easy to predict. In the wake of COVID-19, that’s no longer the case.
In 2021, we expect families to take more vacations, often on weekdays and during the off season. They will take longer trips than they used to, and most likely continue to focus on domestic travel. This should mean a boom for vacation property owners, but perhaps a somewhat chaotic and unpredictable one.
Location less influenced by commute
Working from home is going to continue to be the norm long after COVID-19 has faded away. As a result, renters are less likely to choose the location of where they want to live based on commute times. Other factors like affordability, amenities, quality of life and proximity to shopping and dining will be more important.
Contact us today to learn more about rental property trends and predictions for 2021, and talk to our team about how the resources of a professional property management company can help your rental property flourish in these uncertain times.