Rent Cuts Deepen in Class C Product
Operators of the nation’s Class C apartments have now cut effective asking rents on a year-over-year basis for four consecutive months. This was the last asset class to see price declines during the COVID-19 pandemic, as both Class A and B product have recorded annual rent cuts for the past nine months. In January 2021, Class C prices were down by 1.1% year-over-year. That was slightly deeper than the 0.8% downturn among Class B units. While operators of the more expensive Class A product have eased up on annual rent cuts – going from 3.2% in September 2020 to 1.9% in January 2021 – this was still the steepest price reduction among product lines. In comparison, all three asset classes were recording rent growth just below the 3% mark in March 2020, before the downturn hit.