A precipitous drop in Seattle rent prices

Marketplace Staff Apr 23, 2010

A precipitous drop in Seattle rent prices

Marketplace Staff Apr 23, 2010


Tess Vigeland: Used to be, you could feel pretty smug about owning a home, American dream and all that. But renters are the ones preening “Told ya!” these days.

KUOW’s Ann Dornfeld reports.

Ann Dornfeld: Gina Landino and her husband have just signed the paperwork for their new apartment. It’s in “The Aspira,” a brand-new high-rise in downtown Seattle.

Gina Landino: This is the kitchen I was telling you about, really contemporary finishes. And we love it — tons of space. And this will be our living area and our beautiful balcony. So we are really excited, as you can tell.

Landino says she’s amazed by the value they’re getting. They’re paying just under $1,500 a month — and their first month is free. She says this building has a ton of features their last one didn’t have, like a high-tech media room and terraces to walk your dog. Then there’s the $1,500 Visa gift card from the landlord, the waived application fee and no extra charge for one of their dogs.

Landino: We got a free 32-inch TV, so that was really exciting.

Jeffrey Gibbons: Sony Bravia!

Landino: And we got some free storage. We got, like, seven months of free storage and three months of free parking. The list kept going and going. It was absolutely… It’s amazing.

Landino says she’s never seen anything like it as a renter. But deals like these are actually standard in Seattle’s rental market these days. According to the market research company AXIOMetrics, Seattle rents fell an average of 14 percent from 2008 to 2009 — the largest drop among cities nationwide.

That’s due in part to the large number of apartments that went on the market last year: 6,100 in the Seattle area, the most in two decades. At the same time, companies like Microsoft, which had been steadily hiring, started laying people off instead. As home sales slowed, a lot of condo developers decided to open their new buildings as apartments instead.

Esteban De Castro: Big windows…

Esteban De Castro has just moved into a studio apartment in a brand new neighborhood, South Lake Union. The neighborhood is a sea of high-rise apartment buildings, all built within the past few years. De Castro has rented in Seattle since the late ’90s. But, he says, never in a place as nice as this.

De Castro: There’s absolutely no reason why my bathroom should be this big. Like, for the amount that we pay in rent, your bathroom should literally be, like, just this. But it’s huge. And like the high ceilings totally throws it off, ’cause it makes it seem like I’m living in a cavern. Which is nice! I’ve never done that before. Usually my apartment is, like, so small that I hate it.

De Castro says based on the way rent prices had been going, he expected to schlep out to the ‘burbs to find something he could afford. Instead, for $1,400, he’s walking distance to downtown, in a new building with high ceilings, hardwood floors and a bathroom you could park a car in.

De Castro says there can be a downside to having so many new apartment buildings on the market. His sister is renting in a new development where De Castro says, so many units are vacant that it feels kinda creepy.

De Castro: The people there, they’re bending over backward to try to get anybody and everybody to stay in their place. It feels like desperation, because I’m there every day, and I always see the signs, you know, referral, you know, “We’ll give you 500 bucks to get somebody to come and stay here.” Which is an awesome deal, but you wouldn’t have had to do that before. People would just move into an apartment, ’cause they needed a place to stay before.

Desperate times call for desperate measures from landlords. A few miles away, on Capitol Hill, visitors to the Chloe Apartments are greeted by a googly-eyed, baby King Charles Spaniel.

Dornfeld: Oh, hello, who are you?

Property manager: This is Chloe!

Dornfeld: Hi Chloe! Ohhh. You are precious!

[Sound of dog snuffling on mic]

Barry Blanton: She wants to talk on the microphone!

Barry Blanton develops marketing strategies for Lorig Property Management, which oversees the Chloe Apartments. The building opened last fall.

Blanton: As you’re opening a new building — and everybody was opening them at kind of the same time — what do you do different? And so everybody was doing kind of the same thing, and we thought, “Well, what if Chloe’s a dog?”

A billboard on one side of the building features a huge photo of Chloe with her head cocked toward the busy street. Blanton says a puppy makes a very effective leasing agent.

Blanton: In 2009, ’10, the world got kind of cold. It got tough. You know, the economy was tough and everything else. And I think the dog warms it up, it makes a relationship — and people were looking for comfort.

Renters can take comfort in knowing that analysts expect Seattle rent prices to drop another 9 percent before bottoming out next year.

In Seattle, I’m Ann Dornfeld for Marketplace Money.

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