Moody's: 'No Market Will Be Spared,' but Apartment Vacancies Highs Not Expected

A recent report by Moody’s Analytics forecasting the COVID-19 pandemic’s impact on apartment vacancies found that, even under a “worst case scenario” model, apartment vacancies are not expected to reach or exceed the historic 8.1% high set in 2009.

In the “Protracted Slump” scenario, according to the “Q1 2020: Apartment First Glance” report,  Moody’s forecast model assumes the second quarter GDP will contract by more than 30% (annualized), and the economy will continue slide until late 2021. Under this scenario, multifamily vacancies are expected to rise to 7.3% by the end of the year, spiking to as high as 7.7% by the end of 2021. Meanwhile, asking and effective rents would decline by a total of 5.5% and 6.3% through the end of next year.