ANDERSON, Ind. – A federal moratorium on evictions – one of the measures taken by the Centers for Disease Control and Prevention last year in the fight against the coronavirus pandemic – could be indirectly and partially responsible for an almost unprecedented increase in rates rental apartments.
Driven in part by an influx of potential tenants, those rates have climbed 16.4% since January 2021, according to a report from Apartment List, a national online marketplace for apartment listings. As a perspective, the report noted that rent rate growth from January to October averaged 3.2% between 2017 and 2019.
Property managers find these statistics easy to believe. Gold Key Properties in Madison County, Indiana has seen demand for its listings skyrocket, and prices in some cases have risen by more than 80%.
“(The market is) considerably higher, to the point that it’s almost shocking, but supply and demand are pushing this market,” said Kevin Holladay, real estate administrator and inspector for Gold Key. “It’s holding up because stocks are also low and people are willing to do what they need to do to get ahead. “
The federal moratorium on evictions went into effect in September 2020 and was extended four times by Congress before a Supreme Court ruling let it expire at the end of August. Meanwhile, Kim Townsend, executive director of the Anderson Housing Authority, estimates that at least 85 local families who were allegedly evicted were able to stay in their apartments.
“I heard that there were a lot of (eviction) cases after the moratoriums were lifted,” she said. “There were evictions during the moratoriums, but it was for non-rental issues.
Housing demand has long been viewed by many economists as a barometer of economic optimism. But in recent months, many have viewed these numbers with skepticism. The costs of raw building materials, tighter selection of tenants and higher deposits are also seen as factors that have made some rental properties unfeasible for many potential tenants.
“If landlords were losing money because they weren’t able to collect rent (during moratoriums), they are looking for ways to recoup that lost income,” said Brian Carberry, senior editor of the content marketing for Rent.com, a leading apartment search engine and online marketplace.
“In many places across the country, rents go up year over year, so landlords might have the ability to ask for more for their properties now, especially if there is competition and a low supply in their region. ”
These circumstances exist in Madison County and elsewhere in central Indiana, where the housing market has rebounded strongly from the early days of the pandemic. The phenomenon, according to Carberry, is due in part to people who have moved in with friends or family to consolidate household expenses and are now starting to look for housing again.
“As people search for places to live, they are more likely to grab the more affordable options on the market,” he said. “This leaves more units available at higher prices, which will skew that higher average (rental cost). “
Reducing those costs, Holladay said, will require a complex chain of events, and the individual ties have yet to start showing – and may not do so for some time.
“I don’t know (the rental market) will be able to stay where it is forever, but I don’t know what’s going to set it back,” he said. “Some people get locked out and stay because they have a hard time finding that extra money, and some people try to get out because they have returned to work. Once all the moving parts are put back in place, I think it will evolve into a more sustainable market for everyone. “
To follow Andy knight on Twitter @Andrew_J_Knight, or call 765-640-4809.