DC Area Renters Continue to Lease Apartments As They Deliver

• January 15th 2016

by UrbanTurf Staff

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The absorption of new Class A apartments in the DC area kept up its record-setting pace in the 4th quarter of 2015.

A report recently published by Delta Associates stated that the absorption of Class A rentals has now been at a record-setting pace for six straight quarters. Specifically, 13,429 Class A units were absorbed in 2015, which is more than double the 10-year average for the area.

“The Washington metro area remained resilient against the influx of supply due to demographic and economic shifts in the market favoring apartments,” the report stated. “Absorption outpaced deliveries in Northern Virginia and The District. Rent growth remains positive – albeit very slightly – and vacancy is on the decline.”

Rents increased in the region at a rate of just 0.5 percent in 2015, but dropped 2.5 percent in Northern Virginia. The vacancy rate for the Class A sector in the DC area dropped 100 basis points in December 2015 to 4.6 percent.

In DC proper, almost 900 more units were absorbed than delivered last year, which resulted in the city having the lowest vacancy rate in the area. However, that could change in 2016 as the number of deliveries is expected to be twice that in 2015.

Here is a quick snapshot of average rents for high-rise Class A apartments in DC area sub-markets, as defined by Delta:

• Central (Penn Quarter, Logan Circle, Dupont Circle, etc.): $2,787 a month
• Upper Northwest: $2,963 a month
• Columbia Heights/Shaw: $2,586 a month
• NoMa/H Street: $2,278 a month
• Capitol Riverfront: $2,245 a month
• Upper Georgia: $2,160 a month
• Rosslyn-Ballston Corridor: $2,353 a month
• South Arlington: $1,986 a month
• Bethesda: $2,578 a month

Note: The rents are an average of studios, one and two-bedroom rental rates at new buildings in the DC area.

Definitions:

Class A apartments are typically large buildings built after 1991, with full amenity packages. Class B buildings are generally older buildings that have been renovated and/or have more limited amenity packages.

This article originally published at https://dc.urbanturf.com/articles/blog/dc_area_renters_continue_to_lease_apartments_as_soon_as_they_deliver/10763.