Seattle Apartment Market Ends 2000 With Escalating Rents, Tightened Occupancy
(March 26, 2001) — Renters signing new apartment leases in Seattle during 2000’s 4th quarter saw their rents climb by an average of 6 percent, according to the latest edition of M/PF Research’s Seattle Apartment Report.
This 6 percent annual rent growth, measuring the upturn in rents among the same group of properties between year-end 1999 and year-end 2000, was quite a change from the slight drop in average rents recorded in Seattle during 1999. Furthermore, year 2000 rent growth easily exceeded Seattle’s general consumer price inflation rate of 4.1 percent.
Seattle renters paid an average of $850 a month as of 4th quarter of 2000, with rates for properties built during the past decade topping $1,200 in three neighborhoods: Redmond/Sammamish/Woodinville, Intown and East Bellevue.
Rising rents reflected Seattle’s tightening apartment occupancy rate.Occupancy reached 96.6 percent in 4th quarter, a gain of 3.1 points from the year-earlier level.
“Seattle’s occupancy beat the nation’s 4th quarter average occupancy of 96.4 percent. This was, in fact, the first time the metro’s performance has topped the U.S. norm since mid-1998,” said M/PF editorial director Greg Willett. “Particularly tight occupancy of 98 percent or more was reported in Seattle’s Ballard/North Seattle, South Seattle and Kirkland submarkets.”
Metro Seattle posted solid apartment demand in 4th quarter, with 4,200 net move-ins occurring in the October-December time frame.Calendar 2000 absorption reached 11,230 units, more than doubling the year’s 4,836 units completed.
“Climbing apartment aborption mainly reflected a shift in overall housing demand from the for-sale sector to the rental option. Employment growth, which normally is the biggest factor influencing apartment absorption, actually was relatively lackluster. Seattle added 26,900 jobs during year-ending 2000, and while job growth is rebounding from the trough of just under 18,000 jobs in late 1999, employment growth is not recouping as well as apartment occupancy and rent growth,” Willett said.
Seattle’s current levels of job production are significantly lower than the 60,000 to 70,000 jobs created annually during the 1996-1998 period. While losses in the tech sector are partially to blame for the recent slowdown in overall employment growth, the dot.com fallout was only beginning to hit the metro as 2000 drew to a close.
|Seattle Apartment Market Profile
4th Quarter 2000
|Annual Employment Growth||26,900 jobs|
|Annual Apartment Completions||4,836 units|
|Annual Apartment Demand||11,230 units|
Change in Past Year
|Average Quoted Rent
Change in Same-Store Rents
|$850 per month
M/PF’sSeattle Apartment Report is a quarterly report that includes data and analysis addressing the local economy and trends in apartment demand, supply, occupancy and rents.Information is summarized on the metro level and detailed for 16 submarkets.
Since 1961, M/PF Research has been the trusted national expert in apartment market research. M/PF is retained by investors, developers, owners and lenders to prepare project-specific market studies and to produce broader, strategic market selection analyses and reports. M/PF Research, located in Carrollton, Texas,is a wholly owned subsidiary of RealPage, Inc., a leading provider of property management software and web services.