Portland’s average apartment rents soar as market tightens
How expensive are apartments in Portland these days?
The area’s average apartment rent in June was $1,160 in June, $167 more expensive than it was this time last year.
Apartment rents in the Portland-Vancouver-Hillsboro area grew by 6.1 percent, making it the 10th strongest market in the US, according to apartment data and research firm Axiometrics.
The report credits strong job growth and a decline in home ownership with fueling demand. Job growth rate was 3.1 percent in June, up from 2.8 percent in both April and May.
However, June’s effective rent growth was down from the 6.5 percent rate logged during both May 2014 and June 2013. The market moderated from an August 2013 to March 2014 surge that saw the figure above 7 percent for eight straight months and above 8 percent in December and January.
“Those rent growth figures were unsustainable in the long run,” said Jay Denton, Axiometrics vice president of research. “The good news is that high occupancy is allowing landlords to continue pushing rents at a stronger rate than at almost any time since the Great Recession.”
Though occupancy has remained relatively steady year over year – 96.1 percent in June 2014, compared with 96.3 percent in May and 96.2 percent in June 2013 — occupancy dipped below 96 percent from November 2013 to February 2014 as effective rent growth shot up. Once rent growth moderated, occupancy climbed higher.
“That’s why the growth surge was unsustainable,” Denton said. “As landlords realized prospective residents weren’t signing the lease, they put the brakes on the rent a little bit.”
According to Bureau of Labor Statistics figures, the Portland-Vancouver-Hillsboro area unemployment rate was 6.1 percent in June, the lowest since September 2008. The area regained all the jobs lost during the recession earlier this year, though the state of Oregon is still behind.