Richmond rents climb even as U.S. prices fall
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Rents are falling across the county, driven by a building boom that's flooded the market with new apartments.
Why it matters: Richmond is one of a handful of metros where rent is going up, not down.
By the numbers: As of last month, the median rent for an apartment in metro Richmond was up 1.5% year-over-year, per Apartment List's latest rent report.
- That's a sharp divergence from the national apartment market, where median rent fell by 1.5% year-over-year.
- Richmond's rent hike is even more pronounced in Realtor.com's report, which shows median rent in Richmond up 2% year-over-year, and down nationwide 1.7%.
State of play: A surge in multifamily construction over the last three years, particularly in the South and Mountain West, is what's driving the nationwide rent price dip, per Apartment List.
- Data from Virginia Realtors shows Richmond has been building, just not at the rate of cities like Austin, San Antonio, Denver and Charlotte. Example: Austin's vacancy rate is now nearly 14%, up from 8% last year, per Realtor.com. San Antonio's is 10.9%, up from 10.1%.
- Richmond's apartment vacancy rate, meanwhile, is sitting at 5.2%, down from 8.2% last year.
Stunning stat: Renting in Richmond now costs roughly 25% more than it did before the pandemic, per both reports.
- Median rent in metro Richmond hit $1,507 last month, per Realtor.com, while Apartment List puts it at $1,446.
Threat level: Another factor beyond building is at play in Richmond, per Realtor.com.
- The region continues to draw renters looking to relocate from pricier cities, which keeps pushing down the region's apartment vacancy rate — and pushing up rent.
- At the end of last year, Richmond had one of the nation's highest out-of-market rental demand shares in the nation, Realtor researchers found, with more than 60% of apartment searching coming from other cities.
- If Richmond wants to bring down rent prices, it needs to build more apartments, per Realtor.
Yes, but: Much of the building boom in the last decade focused largely on building luxury apartments, which has helped nearly triple the number of units costing at least $2,000 a month, Axios' Sami Sparber reports.
What we're watching: Fewer people move in the colder months, so expect rents to climb as the peak summer season nears.