Monthly apartment rental rates in Bethesda were the highest in the Washington area this month and up 8 percent over the same month a year ago, according to a new analysis by an online rental website.
Prices for a one-bedroom apartment in Bethesda are 50 percent more than the state’s median price, according to a report by the online firm Zumper that reviewed active-listing data.
Bethesda’s one-bedroom median rate of $2,290 this month is down $10 from January rates, which were still the priciest in the area, according to the report.
Two-bedroom apartment rents in Bethesda also decreased from January to February and on a year-over-year basis, though the $3,070 price tag is still more than $400 above the next-closest area, Reston, Virginia.
“Bethesda is becoming more expensive just because all the new product that’s been delivered and is on the books,” said Tom Cohn, executive vice president of the Property Management Association trade group. “Just like with any piece of real estate, a new piece of real estate is more expensive than an existing piece of real estate, whether it’s a house or shopping center, apartment building or office building.”
Rockville and Silver Spring are also above the state median rate of $1,500, though remain well behind Washington, Reston and Arlington, Virginia. Silver Spring is the second-cheapest among the eight areas in metropolitan Washington ranked in the report at a median rental rate of $1,630.
While the prices in seven of the eight areas ranked by Zumper exceed the median one-bedroom rate across the state, recent income trends suggest buyers can afford these apartments.
Rental search site Apartment List released a report last week detailing the increase in high-income renter households, the fastest-growing demographic in the nationwide housing market.
Using information gathered U.S. Census data, the report found high-income renters grew by nearly 2 million from 2008 to 2017, a 48-percent increase. Homeowners are historically richer than renters, but the gap is closing, according to Apartment List.
Cohn said these “lifestyle renters” are after convenience, as well as the relative safety of the rental market compared to the housing market.
“You’re basically getting all the amenities of a high-end condominium, and you don’t have to buy,” Cohn said.
Growth was most apparent in mid-size metropolitan areas, but renters with six-figure salaries became more common in nearly every part of the country. The pattern of these increases have varied across metropolitan areas, though Washington had “virtually uninterrupted growth over the past decade,” according to the report.
Apartment List posits high-earners are choosing to rent because of an increase in rental supply following the Great Recession coupled with home-ownership difficulties such as tougher mortgage credit requirements and home prices rising faster than incomes.
One-bedroom rental data gathered by Zumper:
- Bethesda, $2,290
- Reston, $2,180
- Washington, $2,130
- Arlington, $2,120
- Rockville, $1,760
- Alexandria, $1,720
- Silver Spring, $1,630
- Frederick, $1,190
