Major Northeast Markets Enjoy Occupancy Recovery
After suffering steep decline in 2020, apartment occupancy across the major Northeast markets recovered well and is now back to topping U.S. norms.
While the U.S. apartment market saw occupancy decline in 2020 during the worst of the COVID-19 pandemic, the major markets across the Northeast suffered a much steeper drop. This was significant because these markets typically enjoy a headline position for occupancy rates, given their urban appeal, job market and the fact that there’s just not enough product to house the population growth in these popular areas.
After hitting the drastic lows of 2020, however, occupancy in these Northeast locations rebounded quickly and is once again ahead of the national average.
As of October, occupancy in Providence is one of the best performances in the nation at 98.8%. Out of the 50 largest apartment markets, only Anaheim logged a better showing in October. Among the big Northeast apartment markets, Providence occupancy bucked the regional trend, retaining a solid occupancy performance throughout the national pandemic decline. In fact, when Boston – Providence’s more expensive neighbor – saw occupancy bottom out at 94.9% in the last two months of 2020, Providence occupancy was much better at around 98%.
Despite notably increased apartment construction activity, occupancy in Newark is one of the strongest nationwide at 98% in October. This market did experience decline during the COVID-19 downturn, with occupancy getting as low as 95.5% in February 2021. However, the rebound was swift and sizable, as occupancy in the market has climbed 250 basis points (bps) since then.
After taking one of the deepest dives during the COVID-19 downturn, New York occupancy recovered well and is now at 97.5% in October. This was one of the earliest and hardest-hit cities in the nation at the beginning of the COVID-19 downturn, as population and job loss led to unprecedented net move-outs. After bottoming out at 94.7% in February 2021, however, occupancy in New York rebounded nicely. The Class A stock in New York was responsible for a big slice of the steep decline, and a notable part of the market’s recovery. Occupancy in luxury units hit as low as 94% in February 2021 before rebounding. Occupancy in Class A product is now at 98.7%, the best showing marketwide.
Occupancy in Boston is a bit lower than these other Northeastern locales, at 97.4%, essentially in line with the national average of 97.3%. Boston started seeing decline a bit earlier than some other major Northeast markets and when this market hit a low point, occupancy hovered there for a while before starting its recovery. In July 2020, occupancy in Boston hit a low point of 95%. Occupancy stayed at that point until March 2021, when the Boston market started to show signs of improvement. Despite recent growth, however, the October rate here remains 140 bps under the showing in nearby Providence.
For more information on the apartment markets in the Northeast, including forecasts and coverage of smaller markets, watch the webcast Market Intelligence: Northeast Region Webcast.