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The homeownership-versus-renting feud took an interesting turn in the final stretch of 2015. According to new data from the CoStar Group, apartment rents significant slowdown in their growth rate in the second half of 2015, with many markets recording negative growth in the fourth quarter.
CoStar Group found that apartment rents grew at an annualized rate of 9.4 percent in the first half of 2015, but saw only 2.7 percent growth in the second half. All told, apartment rents grew by an average of six percent in 2015.
The fourth quarter was especially harsh on this sector, with negative growth in the major rental markets: San Francisco (down 1.7 percent); Washington, D.C. (down 1.1 percent); Houston (down 0.5 percent); Philadelphia (down 0.3 percent); Seattle (down 0.2 percent), and Chicago (down 0.2 percent).
“Our latest analysis confirms the historically strong growth in apartment rents over the first half of the year has given way to one of the weakest fourth quarters on record,” said Andrew Florance, founder and CEO of the CoStar Group. “We’ve always observed seasonality in apartment rents, but the downturn over the last three months of the year is certainly a noteworthy occurrence and one that would not be apparent in a year-over-year comparison. While it may be too soon to declare this a trend, it certainly bears watching.”