Seattle renters don’t need to be told that housing costs have risen dramatically over the past several years – that reality hits home when they write that rent check every month – but some might be surprised to learn just how far they’ve climbed. Rental rates here are up 32.38 percent since 2009 – more than twice the national average of about 15 percent – while incomes have only grown by 11 percent over the same time period. The only city with a greater increase was New York City, which saw a staggering 50.7 percent spike.
In a press release, NAR Chief Economist Lawrence Yun says that not only are renters feeling the squeeze, but home ownership and its guarantee of set monthly housing costs is becoming further out of reach due to rising home prices and stagnating incomes. Yun suggests that increased new-home construction aimed toward entry-level buyers would help renters transition to home ownership and take pressure off the rental market.
If it seems like construction cranes are sprouting like spring tulips in the Seattle skyline, there is good reason: 56 new residential buildings are under construction, planned, or recently completed in Downtown Seattle, which will add 12,392 new residential housing units to the market by then end of 2015. That number will break the record for number of units built in one year, which now stands at 10,056 units built in 1989. Normally, when inventory increases the market sees vacancy rates increase and rents level off, but with Seattle’s booming job market and continued influx of people wanting to call the Northwest home, that has not been the case. Average rent in King Country has climbed to $1,341 per month, with downtown Seattle and Bellevue topping that at $2,084 and $1,961 respectively.
According to the Puget Sound Business Journal, the average rent in King and Snohomish counties is up $28, or 2 percent, over the first quarter of this year, and the vacancy rate for existing buildings is 4.46 percent, which is down slightly since the end of last year. Newly built properties are posting vacancy rates of 4.3 percent. MyNorthwest.com quotes a report from the CoStar Group, a real estate data and information company, that states in order for “vacancies and rents to remain at healthy levels, developers need to dial back new construction after 2015.”
On February 23, the Seattle City Council unanimously approved an ordinance to set a cap on rental rates for Small Efficiency Dwelling Units (SEDUs), also known as apodments or micro housing, in an effort to further ensure that affordable units are being included in residential developments. Under provisions of the new bill, in order to receive the 12-year property tax exemptions that come as part of the City of Seattle’s Multifamily Property Tax Exemption Program (MFTE), developers would be required to reserve 25 percent (up from 20 percent under current regulations) of their units for those making no more than 40 percent of the area’s median income. That would set rates at $618 per month for single-person households making $24,720 per year, which is about $400 per month less than current regulations for “affordable” units.
Roger Valdez of Smart Growth Seattle told The Seattle Times that the program’s incentives won’t make up for money developers will lose on the lowered rents, and he predicts many developers will not participate in the program, resulting in zero units of affordable housing. Similarly, according to the Urbanist, Councilmember Kshama Sawant during the legislative session questioned how much affordable housing is actually being created, and whether the program is simply a loophole for developers to avoid property taxes. The bill will act as a sort of “trial run”, as the entire MFTE program could be facing widespread reorganization in the coming year.
This lovely one level Madison Park home sits in the quiet Canterbury location near Madison Park Shops, restaurants and parks. Amenities include easy access to Downtown, freeway and the Eastside. Beautiful finishes include oak floors, cathedral ceilings, and a new kitchen with family room. The fenced garden boasts lovely plantings and hot tub. This spacious home has an attached two car garage that also includes a large workshop. Gardening included. Prospective tenants will need first and last month’s rent, plus one month’s rent for the security deposit. If you’re interested in this or other Seattle rentals, contact your local real estate agent today!
Most renters have probably experienced it – opening your mailbox to find a notice that your rent is going up. Often, increases come in $50 or $100 increments, but in Seattle’s booming rental market, some are seeing their rents rise by $1,000 or more at a time. Most renters can’t absorb these exorbitant hikes, and Washington State’s Landlord Tenant Law only requires landlords to give 30 days notice for rent changes (60 days in the City of Seattle), giving tenants a short window to find a new home. But according to Crosscut, Washington State Senator Jeanne Kohl-Welles (D-Seattle) is planning to introduce legislation that would require landlords across the board to give 90 days notice if they raise rents by more than 10 percent. The notification period for increases of 10 percent or less would remain at 30 days. For renters who don’t have much cushion in their savings account, this would give them more time to save up enough cash for move-in fees such as first and last months’ rent and a security deposit. According to King-5, the Rental Housing Association of Washington will fight the bill.
Kohl-Welles will also introduce legislation to prohibit landlords from discriminating against potential tenants on the basis of their participation in a government assistance program such as Section 8, which provides rent vouchers for households making 30 percent or less of the area’s median income. The bill would be aimed at landlords who either prohibit those in such a program from applying for housing altogether, or who don’t give them equal consideration with those not enrolled in an assistance program.
If you are interested in renting in the Seattle area, contact your local real estate agent today.
With all the talk about record-high rents in the Seattle area, you may look around at the high-rise apartments sprouting up in South Lake Union, Capitol Hill, and Ballard and think you’ve found the culprits for our status as the U.S.’s 8th most expensive city for renters. But here’s a surprising statistic reported recently by Sanjay Bhatt at The Seattle Times: rents in older buildings are actually rising at faster rates than those in newer ones. Rents in buildings built in the 1980′s grew by a rate of 8.4 percent in the fourth quarter of 2014, whereas rents in buildings newer than 2010 grew by only 1.4 percent (granted, rents in these buildings are much higher to start with).
Renters who care little about granite counter tops and rooftop decks have historically been able to rent units for reasonable rates in older buildings that offer function without the flash. But as many of these mid-century buildings approach 60 or 70 years old, they’re being sold off to development groups who pass on renovation costs to tenants in the form of rent hikes. For residents such as those at the Linda Manor Apartments in West Seattle (a building built in 1964), those hikes came in the form of a 130 percent increase, according to The Seattle Times. One resident saw her rent rise from $1,000 per month to $2,300 per month.
With the addition of 86,000 new residents over the past four years and just under 29,000 new units built over the same time period, housing is at a premium and a low vacancy rate in King County is creating stiff competition for renters. Because of that, landlords are having no trouble filling units, even with ever-rising rents.
If you’re a renter, think about the amount you write on that check every month. Is it inching toward 30 percent of your monthly income? According to a new report by Zillow, gone are the days when mortgage rates made home ownership prohibitively expensive and renting was the affordable option. They report that the average renter in the U.S. is spending 30 percent of their monthly earnings on housing, and Seattle renters spend a little more than 30 percent, according to the Puget Sound Business Journal. Owning a home can cut that percentage in half, as homeowners pay only about 15 percent of their monthly income on their mortgage. Historically, renters have paid about 25 percent of their income toward rent.
Rents in Seattle are up a staggering 21.5 percent over the past five years, and with incomes only having grown 10.4 percent over that same span, renters are increasingly burdened with monthly housing costs. With mortgage interest rates hovering around 4 percent, first-time buyers in the U.S. are only spending an average of 17.5 percent on housing, even with many only paying a 5 percent down payment. Zillow says that even if interest rates rose to 7 percent, buying a home would be more affordable than it has been historically.
So, if you are looking to save on monthly housing costs, start saving those pennies for a down payment! If you are interested in real estate in the Seattle area, contact your local agent today.
The dating world has OkCupid, Match.com, and a host of other websites that claim to connect you with your soulmate. New service MatchPad has applied those same principles to connecting potential roommates, using criteria such as desired budget and location, as well as matching up compatible personality traits. According to an article on mynorthwest.com, the service launched in September as a website, and the app for both iOS and Android users will be available in January. Renters in Seattle won’t be able to take advantage of the service just yet, as it currently only operates in New York City, but once it does reach the Northwest it could help take some of the guesswork out of finding that elusive perfect roommate.
This three bed three bath Madison Park home is a perfect location, is now available for rent! Three bedrooms are located on the 2nd floor & 2 baths. The Office features views on the 3rd floor, and master bedroom has 3/4 bath and a fireplace. On the main floor, you’ll find an updated kitchen, family room, dining room, living room, & powder room. The yard space is truly amazing! There’s a large deck off the kitchen and family room, and two side patios on the South side of the home. The laundry room is located in the basement, and there is a two car garage parking off the alley. *Looking for a short term lease – 3 months* All rooms are furnished except one bedroom. For more information on this, or other Seattle rentals, contact your local real estate agent today.
Even if you live in a rental, the cold, wet weather of winter should prompt you to do some preventative maintenance on your home, both to limit your liability for any potential damage from the elements and to keep your home as comfortable as possible during the winter. Talk with your landlord, both to make sure they are performing their share of required maintenance, and also to find out what tasks are your responsibility.
The Rental Housing Association of Washington has several tips regarding what you can do as a renter to minimize damage to your unit this winter. If your lease requires you to perform yard maintenance, make sure you’re keeping the area around your foundation clear so excess moisture doesn’t build up and seep into the home (check with your landlord before you do anything beyond basic yard cleanup). Bag up fallen leaves and trim shrubs around the perimeter of your house. But don’t pull out that ladder just yet, as it should be the owner or landlord’s responsibility to make sure roofs are sound and gutters are draining correctly.
It is often the tenant’s responsibility to make sure smoke and carbon monoxide detectors are working, and during the season when more people are using their heat and having fires, it’s important to make sure these are operating correctly. Check your lease to determine if this is something you need to keep an eye on.
Especially in damp climates like ours in the Northwest, it’s important to pay attention to moisture levels inside your home, as well as outside. In the winter, when you’re more likely to have all your windows and doors closed, keep indoor air dry and circulating with fans, or occasionally crack a window to let some fresh air in. If you haven’t turned your heaters on yet, make sure they’re free of dust and move any belongings away from vents to minimize fire risk.
These tips should help ensure that you have a warm and uneventful winter in your rental! If you are interested in finding a rental property in Seattle, contact your local real estate agent today.