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Cities With the Highest (and Lowest) Rental Vacancy Rates

Money Talks News Logo By Adriana Lopez of Money Talks News | Slide 1 of 24: This story originally appeared on Porch. The COVID-19 pandemic has disrupted many aspects of life, and some of the most significant shifts have occurred in housing. More time spent working, schooling, and socializing at home in line with public health guidance has people increasingly reconsidering their living preferences. Simultaneously, spikes in unemployment, especially for low-income earners, have highlighted concerns about rental affordability with enormous implications for renters and landlords alike. This combination of factors could lead to high activity in some parts of the rental market while creating uncertainty or vulnerability in others. One of the areas where these trends are already playing out is in the types of units being rented, as renters show a stronger preference for single-unit rentals over structures with two or more units. Historically, vacancy rates for multi-unit rentals already tend to be higher than for single units. But following the outbreak of the coronavirus that causes COVID-19, these figures diverged even more in late 2020, as vacancy rates spiked upward in multi-unit rentals while rates in single-unit rentals exhibited a similarly sharp decline. Whether from virus-related concerns about sharing spaces or a greater premium placed on space while working and schooling from home, COVID-19 has helped push vacancy rates for single-family rentals to historic lows. COVID-19 could also have long-term impacts on rental affordability. Already, it has become more expensive for most households to rent, according to the rental affordability index calculated by the U.S. Department of Housing and Urban Development. This index measures whether a typical renter household has enough income to qualify for a lease on the typical rental home. When the index equals 100, the median income of renter households is just high enough to qualify for the median-priced rental unit nationally; the higher the index is above 100, the more likely it is that renters will qualify for a typical rental unit. Even before COVID-19, the long-term trend in affordability was concerning, but with a steep tick downward in 2020, the index is now at its lowest point in the past two decades, just above 100. This means that currently, approximately 50% of potential renters — all those earning less than the median income — cannot afford the median monthly rental cost. Despite strong government efforts to stabilize the economy, COVID-19 has disproportionately harmed lower-income households, who are also more likely to rent. As long as heightened unemployment continues, these households may struggle with housing affordability. It’s not the usual blah, blah, blah. Click here to sign up for our free newsletter. Sponsored: How to find cheaper car insurance in minutes Getting a better deal on car insurance doesn’t have to be hard. You can have The Zebra, an insurance comparison site, compare quotes in just a few minutes and find you the best rates. Consumers save up to $670 per year, according to the site, so if you’re ready to secure your new rate, get started now.

Cities With the Highest (and Lowest) Rental Vacancy Rates

This story originally appeared on Porch.

The COVID-19 pandemic has disrupted many aspects of life, and some of the most significant shifts have occurred in housing. More time spent working, schooling, and socializing at home in line with public health guidance has people increasingly reconsidering their living preferences. Simultaneously, spikes in unemployment, especially for low-income earners, have highlighted concerns about rental affordability with enormous implications for renters and landlords alike. This combination of factors could lead to high activity in some parts of the rental market while creating uncertainty or vulnerability in others.

One of the areas where these trends are already playing out is in the types of units being rented, as renters show a stronger preference for single-unit rentals over structures with two or more units. Historically, vacancy rates for multi-unit rentals already tend to be higher than for single units. But following the outbreak of the coronavirus that causes COVID-19, these figures diverged even more in late 2020, as vacancy rates spiked upward in multi-unit rentals while rates in single-unit rentals exhibited a similarly sharp decline. Whether from virus-related concerns about sharing spaces or a greater premium placed on space while working and schooling from home, COVID-19 has helped push vacancy rates for single-family rentals to historic lows.

COVID-19 could also have long-term impacts on rental affordability. Already, it has become more expensive for most households to rent, according to the rental affordability index calculated by the U.S. Department of Housing and Urban Development. This index measures whether a typical renter household has enough income to qualify for a lease on the typical rental home. When the index equals 100, the median income of renter households is just high enough to qualify for the median-priced rental unit nationally; the higher the index is above 100, the more likely it is that renters will qualify for a typical rental unit.

Even before COVID-19, the long-term trend in affordability was concerning, but with a steep tick downward in 2020, the index is now at its lowest point in the past two decades, just above 100. This means that currently, approximately 50% of potential renters — all those earning less than the median income — cannot afford the median monthly rental cost. Despite strong government efforts to stabilize the economy, COVID-19 has disproportionately harmed lower-income households, who are also more likely to rent. As long as heightened unemployment continues, these households may struggle with housing affordability.

It’s not the usual blah, blah, blah. Click here to sign up for our free newsletter.

Sponsored: How to find cheaper car insurance in minutes

Getting a better deal on car insurance doesn’t have to be hard. You can have The Zebra, an insurance comparison site, compare quotes in just a few minutes and find you the best rates. Consumers save up to $670 per year, according to the site, so if you’re ready to secure your new rate, get started now.

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