Monthly rents topped $1,500 for the first time in downtown Seattle and Bellevue during the first quarter of this year, according to a new report from Tom Cain of Apartment Insights. The Seattle-based company tracks apartment complexes with 50 or more units in King and Snohomish counties.
Downtown Seattle is the first Puget Sound area submarket where rents exceed $2 a square foot. The average monthly rent in downtown Seattle is $1,512, or $2.03 a square foot. In downtown Bellevue, the average monthly rent is $1,520, or $1.76 a square foot.
Rents had declined in the fourth quarter of last year after climbing steadily, if slowly, since the second quarter of 2010. In the first quarter of this year, rents jumped $18 to an average rent of $1,094 in King and Snohomish counties. Cain attributed the rent spike to a large number of more expensive new units — 1,753 in all – being included in the rent survey for the first time this quarter. When these new properties were excluded, the rent increase fell by half, with average monthly rent rising $9 to $1,085.
Meanwhile, the vacancy rate seems to be stabilizing, after increasing during the fourth quarter. Vacancies tightened slightly: The vacancy rate ticked down to 5.69 percent from 5.86 percent in the prior quarter. The tightest rental submarkets in King County are in the Seattle North Central submarket, the area north of the ship canal to 85th Street, where vacancies are just 3.46 percent. Vacancies in the Capitol Hill submarket are at 3.6 percent, with the next highest rate in the First Hill neighborhood at 3.73 percent. The highest vacancy rate is in Federal Way at 7 percent, followed by SeaTac at 6.88 percent and Renton at 6.71 percent.
Rental incentives are steady at $36 per unit, same as the previous quarter. Just two in five properties are offering incentives in King County, compared to half of those in Snohomish County, the report said.
New construction will add 3,119 units to the market by the end of the year.
Source: Biz Journal