HOUSING
Rent
continued from page 1
MORE JOBS, MORE COMPETI-
TION
During the last recession many workers
who lost their jobs moved in with relatives
or took on roommates. About 32 percent of
U.S. adults were living with roommates or
adult family members in 2012, up from 27.4
percent in 2006, according to Zillow, an
online real estate firm.
Stepped-up hiring has begun to reverse
that trend. About 2.8 million more Ameri-
The three metro areas with the biggest
annual increase in rent in January, accord-
ing to Trulia: Denver (14.2 percent),
Oakland, California (12.1 percent), and San
Francisco (11.6 percent).
Job growth in each of those cities also
eclipsed the national growth rate of 2.3 per-
cent over the 12 months ended in January.
Employment grew 3.7 percent in Denver,
2.7 percent in Oakland and 4.5 percent in
San Francisco.
HOMEBUYING DELAYED
Traditionally, renting has been a stepping
stone toward homeownership. When rents
rise, tenants are motivated to buy sooner,
80 percent of new complexes, Nadji estimates,
are high-end projects aimed at renters willing to
pay a premium for amenities like gourmet
kitchens and concierge service
cans have jobs than 12 months ago.
“The share of young adults with jobs has
climbed in the past year, and that will help
many of them move out of their parents’
homes,” says Jed Kolko, chief economist at
online real estate firm Trulia. “Most of them
will be renters first.”
More people vying for apartments helps
drive rents higher. And metropolitan areas
with faster job growth are generally seeing
higher-than-average rent hikes as well.
especially when interest rates are near his-
toric lows, as they are now.
But these days, renters are taking longer
to buy. The U.S. homeownership rate ended
last year at a 19-year low of 64.4 percent.
Between higher rents taking a bigger bite
out of the bank account and sharply higher
home prices, potential buyers are having
more trouble saving for a down payment
and qualifying for a mortgage.
And many millennials, or 18- to 34-year-
PHOTO BY JERRY FOSTER
month’s rent.
Here’s a closer look at why apartment
dwellers will probably see rents go up for a
sixth straight year.
olds, simply prefer renting.
That’s true for Alyssa Hankins, a market-
ing and social media strategist in Los
Angeles. She moved in February to a newly
opened complex where rents range from
$2,325 for a studio to $5,920 for a two-bed-
room unit. She wants to be able to move
quickly if a job opportunity comes up.
“It’s less about affordability and more
about flexibility,” says Hankins, 29.
When renters stay put, fewer apartments
are available for new tenants, which in turn
drives up rents.
NEW APARTMENTS ARE PRICEY
Developers added 238,000 apartments
nationwide last year, a 14-year high, with
another 210,000 expected this year, accord-
ing to Marcus & Millichap.
In theory, more apartment construction
should help bring down rents because land-
lords would compete for tenants. But 80
percent of new complexes, Nadji estimates,
are high-end projects aimed at renters will-
ing to pay a premium for amenities like
gourmet kitchens and concierge service.
How much of a premium? The average
rent for apartments completed last year was
$1,721. That’s 46 percent higher than the
average apartment rent for older units,
according to Marcus & Millichap and data
provider MPF Research.
“There’s very little new supply being
added anywhere else,” says Nadji, “so that’s
why there’s so much pressure on rents and
very little choice for the average renter.”
Save the Date
The 2nd Annual East Portland
Housing & Resource Festival
“A Family Fun Event”
Saturday, August 8, 2015
12 noon to 7pm
Lents Park
(SE 92nd & Holgate Streets)
•
•
•
•
•
•
•
Activities include:
“Homes for Sale” Bus Tour
Local Talent Show
Market/Information/Food Vendors
Resources for new home buyers,
renters and existing homeowners
Free Giveaway’s
Live Music/Entertainment
Kids Area with face painting,
puppet show, and other activities
Open and FREE to the Public
For additional information or to register as a vendor
call 503-595-3517, ext. 301
Page 8 The Portland and Seattle Skanner April 22, 2015