Rent prices for a single-family home grew by only 1.7 percent in May across the country — the lowest increase since July 2010.
That number is, according to data from property analytics provider CoreLogic, down from 2.9 percent growth in May 2019. In April, rent prices grew at 2.4 percent which was, at the time, also the lowest growth in years.
Prior to the coronavirus outbreak, numbers had stabilized to an annual average of of 3 percent growth. But after the pandemic closed down large parts of the economy and put millions out of work, tenants all over the United States struggled to find the money for rent in one of the biggest crises seen this decade. By April, national unemployment reached an 80-year high with large outbreaks or particularly dependent on tourism saw even steeper drops. In Detroit, employment rates fell by nearly 20 percent.
“Single-family rent growth slowed abruptly in May as the nation felt the full impact of the economic crisis caused by the pandemic,” Molly Boesel, principal economist at CoreLogic, said in a prepared statement. “Some metro areas, especially those that depend on tourism, were hit hardest by job losses.”
According to CoreLogic, the outlook is dour for both tenants and owners who rent out properties. The current cycle — states struggling with fresh outbreaks and being forced to reopen and then close economies — could continue for months to come and fuel wider unemployment. Even more than disrupting the market, the current situation could create severe humanitarian problems as bans on evictions are lifted and millions struggle to find money for rent as they are unable to work.
“With unemployment rates predicted to remain high through the end of the year, we can expect to see further easing in rent growth as the economy struggles this year,” Boesel said.