The coronavirus crisis appears to have caused a dramatic slowdown in rent growth in Greater Boston according to new data from the Zillow Group.

Average rents for apartments in the area grew by only 2.5 percent, to $2,652 per month, the company’s survey of MLS-listed units found. That compares to 3.4 percent growth in March.

Nationally, rent growth slowed in 33 of the 35 largest U.S. metros, with Columbus and Cleveland being the two exceptions, and even fell in 16 of the country’s major rental markets including Austin, Texas and San Jose, California, the company found.

The company said renters, many of whom work in the sectors most affected by pandemic-driven mass layoffs and business failures, are seeking less expensive housing options.

“Housing was in a generally strong position before the pandemic, with low inventory and high prices shutting many would-be buyers out and creating unusually high demand for rentals. Rents soared, making it difficult for many to build emergency savings to tap into at a time like now,” top Zillow economist Skylar Olsen said in a statement. “We’re seeing rents slow now as some people are no doubt pursuing more-affordable options such as moving back in with parents, moving to a less-expensive area or doubling up in instances where it can be done safely.”

Large multifamily developer Equity Residential report its rents have fallen more in Greater Boston than anywhere else in the nation thanks to the pandemic, and real estate analytics firm Yardi Matrix predicts rents will fall about 1 percent for the rest of 2020.

Significant uncertainty surrounds the rental markets in Greater Boston and elsewhere with significant student populations as colleges and universities debate how they will restart in-person classes in the fall, or if they will at all. While rent collections at professionally managed, middle- to higher-tier multifamily properties appear to be holding steady thanks to federal stimulus checks and expanded unemployment assistance, state and national industry groups are lobbying for direct government subsidies to help renters meet their monthly payments.

Massachusetts housing advocates and landlord groups are both arguing for state or federal rent subsidies to help both renters and landlords through the pandemic, while a bill that would let individual municipalities temporarily freeze rents during the state’s coronavirus state of emergency is being discussed in the legislature.

Zillow: Boston Rent Growth Slowed Dramatically in April

by Banker & Tradesman time to read: 2 min
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