A couple of interesting notes on the Seattle rental market:
Seattle Rents to Rise 25%
In an article by Marc Stiles of the Daily Journal of Commerce. He noted that Seattle Rents are expected to rise by 25%.
Apartment development is heating up and to understand why turn to page 4 of Dupre + Scott Apartment Advisors’ new report. The Seattle company says Puget Sound-area rents could climb almost 25 percent in the next five years and 50 percent between now and 2020.
Dupre + Scott bases its outlook on historic rents and incomes, and what economists Dick Conway and Doug Pedersen forecast for per capita income. Going back 30 years, Dupre + Scott found a remarkable correlation between incomes and rent. True, actual rents fell during the last two recessions, but not that much. And when the economy rebounded, rents bounced back quickly.
Supply and demand could throw the correlation off track, said Mike Scott. Currently, his company projects the supply of new units will remain extremely constrained. Squeezed between tighter lending standards and equity partners who want better returns, Dupre + Scott says the region will see only 2,000 units open next year, the lowest production level in 40 years.
Even 2012 will be slow, according to the company, which expects 3,000 units will open then.
Is Inventory Down?
I noticed something this weekend, pulling a list of rentals for a client of mine. She asked if I could send her a list of condos between $2,000-$4,000 in Downtown Seattle (MLS area 701). I was pretty surprised to see only 22 condos for rent. Many of them I recognized and have been on the market for weeks. With such little inventory to view, it seems like a good time for a landlords to take advantage.