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Hartford-area landlords are ramping up concessions in an effort to lure more renters into their units as the pandemic puts a hold on many moves and low mortgage interest rates draw large numbers of homebuyers away from their apartments.
A new study from Zillow shows that the share of Greater Hartford rentals offering a concession, such as free rent or free parking, is 22.6 percent, up from 14.9 of listings last year.
The increase in rental concessions mirrors a national increase driven by many of the same factors. Rental concessions have plateaued and are offered on about a third of all listings nationwide, Zillow’s report found.
Those concessions could be a positive sign for the apartment industry, however.
Zillow research also found that they are successfully drawing Gen Z (ages 18 to 25) renters out of their parents’ homes and into apartments.
More than a third of Gen Z renters who moved in the past year say they moved out of a friend or family member’s home, up from 20 percent in the spring. Nearly half of Gen Z renters Zillow surveyed (49 percent) say concessions were a motivation for their move.
“The effective savings rate is what renters would save on their typical housing costs over the course of their lease because of both lower rent prices and concessions,” Zillow economist Joshua Clark said in a statement. “Those savings could be enough to cover the cost difference between a one-bedroom and a two-bedroom unit. Plus, if these Gen Z renters who moved home retained their jobs through the pandemic, they’ve likely saved enough to afford a larger or more desirable apartment.”
The effective savings rate of the concessions offered by Hartford landlords is 15.4 percent over the course of a renter’s lease, Zillow found. Median rent in the area is $1,407 a month, up 3.3 percent over last year the report found but less than the median $1,103 monthly payment and 2 percent year-over-year decline reported by Apartment List in its most recent Hartford rental report.
This survey data shows positive momentum for Gen Z renters, but young adults continue to face higher rates of unemployment and an uncertain future – factors that drove them to move in with or continue living with family members in the first place. Previous Zillow research found in April, when many stay-home orders went into effect, 13.1 million young adults were living with parents and not employed, up from 8.5 million, a 53 percent jump from pre-pandemic conditions in February. By August, 10.2 million unemployed young adults were still living at home.
