Zillow: Rents Are Growing at the Fastest Rate in Almost Two Years

Comments

1
Don't believe what people who make money by selling homes have to tell you about the cost of rent.
2
It's almost as if we have a shortage of homes in a city that's pretending it's a suburb and refusing to upzone or even allow duplexes in the majority of our land area.

We do it to ourselves.
3
@2 - No need to pout, there are upzone plans in the works that address the need all over the city.
4
And yet we have no city official willing to go to bat against foreign investors because lowering prices will chip away at their tax dollars. It’s almost as if depending on property taxes gives city governments incentive to cheer rising housing prices.
5
"rent in Seattle is 4.9 percent higher than this time last year"

Isn't this the lowest annual increase we've seen in years?

2017, for example, showed a 13.5% increase over 2016.
6
@2 Good point. If we just changed zoning regulations, a huge percentage of existing single family homeowners would surely turn their properties into multi-unit housing for low income families, right?
7
@4 Which of the following are you against?

1. foreigners buying homes and letting them sit vacant

2. foreigners buying homes and renting them out

3. foreigners buying homes and living in them

It's totally reasonable to tax the hell out of (1). While (2) might drive up purchase prices, it also drives down rents. Being against (3) makes you look a little bit like a Trump supporter.
8
@5 - I know you're just trying to muddy the waters with a straw man argument, but for those others who might be confused: yes, you'd probably see a gradual trend of SF homes redeveloped as MF as seniors downsize, families sell and move, etc. In the absence of regulation those new units would go at market rates---but every Richie Rich that buys one is one less Richie Rich competing for a down-market unit in Seattle or a inner-ring suburb that someone making less money might be able to afford. And in turn that relieves pressure on properties further down-market or farther from the core and on and on....
9
Sorry hbb, meant to point to @6
10

Remember when The Stranger freaked out because Scott Lindsay's campaign lassoed a group of major cities and started ranking them against Seattle? That was two days ago.


Here's the data source for this post. "Zillow's Chief Economist Dr. Svenja Gudell ... and her team of economists and data analysts produce extensive housing data and research covering more than 450 markets at Zillow Real Estate Research."


I don't think there's anything wrong with this post; I just wanted to bitch about Tuesday's post one more time. Thank you for indulging me.

11
@8 Shouldn't we already be seeing the trend you describe?

I mean, look at Capitol Hill and the CD: it's zoned for multi-unit housing from basically I-5 to 19th (looking West to East) and Aloha to Yesler (looking North to South).

It's been zoned that way for a long time now. There is a great deal of turnover in properties in that area--you can probably sift through old Stranger articles to find support for that (look for the ones bemoaning the loss of the Red Apple on 23rd).

But there are still a ton of single family homes in that area. I'm no expert, but it sure seems to me that the reason more of these properties have not been all converted to multi-unit housing is because people like single family homes in desirable neighborhoods, and are willing to pay a lot of money to live in them. When the traditional 6000 sq. ft. SFH lots are redeveloped, it is pretty much always for townhouse projects that are essentially 4-6 single family homes with minimal lots. No one is building duplexes or similar housing in that area, although there is absolutely nothing stopping anyone from doing that if they desired.

I'm not "trying to muddy the waters with a straw man argument." I'm pointing out that its silly to expect zoning changes to substantially alter the behavior of existing and prospective property owners, because doing so hasn't had that effect in the past.

12
@11: Single family homes are expensive. It needs to be worth the money for a (for-profit) developer to tear down a home and build new ones. It's not profitable to replace a single family home with a duplex or fourplex (unless the single family home is falling apart and needs to be replaced anyways). It's only profitable if we massively upzone, at which point replacing the house with 10 units makes sense (and money). We're not doing that, so single family homes will remain and only slowly be replaced.

Here's a long thread on that concept: https://twitter.com/eparillon/status/976…
13
@12:

Most of the SFH's on my block, many of which were in decent condition (one had even been substantially remodeled a little over a year before it was torn down) are gone and have been variously replaced with townhomes and whatever you call those boxy cheap-assed Lego-brick looking things with Pergo flooring thrown up as "siding", so IME at least replacing a SFH with a duplex/fourplex/sixplex would appear to be eminently profitable. Granted, some of this redevelopment occurred eight to ten years ago, but about half of this new construction took place in a very short span of time, a roughly 18 month period between winter of 2015-6 and summer of 2017.

The sheer onslaught has slowed down, but it certainly hasn't stopped: there are several multi-units still in various stages of construction and a 1950's era brick triplex, of which there are many in the area, less than two blocks away was just demolished a couple of weeks ago and is being replaced by a fourplex.
14
@13: Okay? I'm missing your point. So your block was redeveloped; was your entire neighborhood?

Also, 1940s-1950s construction was pretty shitty; I've had lots of fun mold and other experiences with those. I wouldn't be surprised if those "decent condition" buildings weren't actually in good shape, or had so many asbestos/lead issues that they weren't worth remodeling.
15
@11: I called your argument a straw man because no one is suggesting that all eligible SF parcels are going to turn over instantly once they get zoned for MF. It happens gradually based on where people are in their lives and their priorities. More to the point, we are seeing the trend: unit growth in our urban centers/urban villages has been huge in the years since the adoption of the urban centers strategy in 1994 (not that long ago in the life of a city). In fact neighborhoods like Ballard have been blowing past their GMA targets much to the consternation of slow growth advocates. I live in the CD and I see a steady march of SFHs being redeveloped. The last comp plan update probably has the stats--check them out.

As for the economics, keep in mind that it only takes the stroke of a pen and a couple of weeks for a newly hired Amazonian to move to town looking for a place, but it takes years to plan, finance, permit, and construct a dwelling. When job growth is this fast it'll take time for the housing supply to catch up and prices to stablize. All the more reason for the City to get out the way by allowing reasonably compatible MF unit types in the city's currently SF-only zones. In the meantime the growth we have seen is being credited with keeping rents from climbing even higher. Down in San Francisco housing affordability advocates are pointing to us as a model, believe it or not.

While I'm on my soapbox I also think we should be more permissive of neighborhood retail but that's another issue.
16
@Heidi and everybody: I haven't rented in Seattle in 21 years (my monthly rate for a one-bedroom + parking garage space in Ballard was then.....wait for it.....$560 / month in 1997). You're scaring me about what is on its way to happen, too, in my community outside Seattle and King County!
All my neighbors except for me recently got a rent-increase notice from our Seattle and Vancouver, B.C.-based property managers. My landlord mentioned talk of "meeting market value, with steady annual increases over the years, plus an added flat utility rate". I am a low income veteran with nowhere else to go and no parents to move in with (mine have both been gone for the past 7 1/2 years now, and I love and miss them dearly)! I have been a good tenant (or at least, have tried to be) for nearly 14 years in the same unit. Am I fucked?
17
@6 & @2 - Good point #6 that up-zoning may not lead to greater density, more supply and lower rents. Just because it has on every other city on the planet doesn't mean it would work here. Laws of economics are just fake science.
20
@16 Yes, you're fucked. You may have to move out of Seattle.
21
@14:

That WAS rather the point. Within a three or four block radius I would say approximately 40% of the SFH's have been torn down and replaced by townhouses, condos, and apartment buildings. Granted, most of the low-hanging fruit has been picked, but as the real estate market continues at its white-hot pace the scattered holdouts are slowly - and steadily - succumbing to the pressure to sell out. In fairness, I should point out that our neighborhood has always been zoned for mixed SF and MF housing, but it remained fairly stable for decades until about 2006 when the last big wave of development occurred, then went stagnant after the real estate bubble burst in 2008, but there's been a strong resurgence in new development in the past couple of years.