1500 Massachusetts Avenue NW
Last week, UrbanTurf covered what has been happening in the Class A apartment market in the DC area. However, many renters in the region do not live in high-rise Class A luxury buildings, so this article takes a look at the Class B market with some help from Delta Associates’ first quarter report on that sector.
First, a couple 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. (Privately rented units in a home are not included in this analysis.)
Courtesy of Delta Associates.
The first thing that the Delta report revealed is that there are notably more vacancies in the Class B market versus the beginning of 2012. In the Metro area, vacancies rose to 4.4 percent at the end of 2012, compared to 2.2 percent last year, and a mere 1.5 percent at the end of the third quarter. However, that 4.4 percent figure is a little misleading, as vacancy varies notably by city/state. In Northern Virginia, vacancy rates are at 4.2 percent and at 5.1 percent in suburban Maryland; in DC, however, the vacancy rate sits at just 2.5 percent.
The differing vacancy rates are reflected in the effective rents of each area: they remain highest in DC ($1,893) followed by Northern Virginia ($1,592) and are lowest in suburban Maryland ($1,398). (Compared to a year ago, Class B rents have actually risen in DC and suburban Maryland, and dropped in Northern Virginia.) Here is a quick snapshot of average rents for Class B mid- and high-rise apartments in DC area sub-markets, as defined by Delta:
This article originally published at https://dc.urbanturf.com/articles/blog/vacancy_rises_for_dc_areas_class_b_apartment_market/6901.
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