Despite Record Number Of Units, Rents Are Still Rising

rentIf 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.”

If you are interested in renting in the Seattle area, contact your local real estate agent today!

Renters In Older Buildings Blindsided By Rent Hikes

rentWith 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 are interested in renting in the Seattle area, contact your local real estate agent today.