Apartment market in the midst of a pandemic. The apartment market remained on steady course through 1st quarter 2020. 2nd quarter data are expected to reflect the pandemic’s impact. Nationwide average apartment occupancy was nearly 96% at the end at Q1. National average rent was $1,427. Apartment demand had been strong up to the beginning of virus outbreak, and now many investors are taking a wait-and-see approach. Apartment cap rates averaged 5.2% for class B properties last December. The national average cap rate is 5.5%. The outlook for 2020 Q2 GDP isn’t good. Recovery is dependent on containing the virus so consumers can get back to spending and doing business. Everyone hopes to avoid a second shutdown. Several economists are forecasting four quarters of negative growth and apartment rents returning to pre-pandemic levels in early 2022. Still the apartment market in Los Angeles remains one of the top markets in the nation.
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