The apartment market remained tight this past spring in Whatcom County, but rental prices may be hitting a peak.
Whatcom County's apartment vacancy rate was 2.2 percent last March, matching the rate from last fall, according to a report from the Runstad Center for Real Estate Studies at the University of Washington. It is the lowest vacancy rate among the Washington markets studied and is significantly lower than the state average of 4.5 percent.
Despite the low vacancy rate, the average apartment rent was $782 a month, the same average rate as the fall of 2011. Rents in Whatcom County have steadily risen since the spring of 2010, when the average rent was $733 a month.
In a market dominated by college students, changes in renter behavior may be a factor in slowing rate increases. Wendy McLeod, leasing coordinator for Son-Rise Property Management, said she's noticed more one-bedroom apartments becoming available for the fall. Summertime is typically a period of flux for the local apartment rental market, with college graduates moving out and new students moving into the area.
"I think more students are being more money-conscious this year," said McLeod, noting that she's seen more students looking for rental houses and multi-room apartments that can handle more roommates to help split the rental costs.
Cutting costs is also a growing trend for the non-student renter, McLeod said. She's had more inquiries from potential renters who want to be closer to their work to save on transportation costs, for example.
"They are looking for something nice, but they also want something that's more affordable," she said.
One factor for the low vacancy rate, particularly in Bellingham, is the lack of new construction. While some apartment projects are under way in Bellingham, new projects appear to have slowed. According to city of Bellingham data, permits have been issued for only one multi-family residential project and one mixed-use building project in the first five months of 2012.
Several possible projects are in the public-meeting stage, however, including three six-unit residential buildings and a 24-unit residential building on Tull Road, just south of Walmart.
Statewide, an improving economy is cited as a factor for lower vacancies, according to the Runstad report.
"Much of the improvement in vacancies can be attributed to the improving job prospects coupled with increased household formations and relocations to Washington," the report stated.
When the recession hit and job losses took place around 2008, a significant number of people across the country moved in with other family members. According to the U.S. Census Bureau, there were 22 million shared households across the country in 2010, an 11.4 percent increase from 2007.
"Although reasons for household sharing are not discernible from the survey, our analysis suggests that adults and families coped with challenging economic circumstances over the course of the recession by joining households or combining households with other individuals or families," said Laryssa Mykyta in a news release accompanying the census data.
Later this summer McLeod should get a better idea of the demand for apartments. Son-Rise manages about 2,000 apartment, condominium and housing units locally.
"This is our busiest time of year, with many people moving into apartments in August and September," McLeod said. "So far the amount of people moving out this summer is fairly typical; I would expect it to be similar as students return."
Reach DAVE GALLAGHER at firstname.lastname@example.org or call 715-2269. Visit his business blog online at blogs.bellinghamherald.com/business or get updates on Twitter at twitter.com/BhamHeraldBiz.