Saturday, February 28, 2015

Seattle Rents Increase as Demand Grows

The last few years have seen average yearly rent increase as much as 8% and projections are for 2015 to still be high but around 6%. Although over 35,000 new units will become available it is still not meeting demand. As of January, 2015, average apartment rent within 10 miles of Seattle is $1702. One bedroom apartments in Seattle rent from $1300 to $1850 and two bedroom apartments average $1926.

Over the year, the average rent has risen by $94 or 7.9 percent accelerating from a 6.8 percent annual gain in the first quarter according to Seattle-based Apartment Insights Washington. Those averages mask a wide range of rents: At $1,912 a month, West Bellevue had the highest overall rent, an annual increase of 6.4 percent. Downtown Seattle ranks the highest on a per-square-foot basis, at $2.43, up 5.7 percent from the first quarter. The lowest rents are in SeaTac ($901) and Des Moines ($923).

But Ballard also had a vacancy rate of 8.6 percent, the highest in Seattle. And when new apartments that just opened are included, the vacancy rate shoots up to 18 percent.Apartments in Seattle’s Ballard neighborhood saw the biggest increase in rents. The average asking rent was 12.3 percent higher over the quarter, rising to $1,628. Properties in King and Snohomish counties built before 1950 raised rents in the second quarter 5.2 percent, more than any of the more recent vintage properties, Apartment Insights’ data shows.

The apartment boom in Ballard has led to a doubling of the inventory over the past six years, said Tom Cain, head of Apartment Insights Washington. When the units now being built are complete, Ballard’s inventory will have quadrupled.

New units rent for a premium, and they’re part of what’s driving up market rents, Cain said. Across King and Snohomish counties, the average apartment rent in a property built since 2010 was $1,754, while the average rent in a property built in the 1970s was $1,019. As some tenants trade up for newer apartments, landlords of older properties may be able to raise rents, too.