When looking for a rental property in 2018, understanding the local market is an important factor. Typically, due to their prime location and desirability, rental property rates in big cities outpace those in surrounding suburbs and smaller cities. This may not always be the case, however. One such example is happening today where rental rates for the relatively small City of Bellingham are rising faster than those in Seattle. While rental rates are climbing faster than those in Seattle, prices remain competitive. There two main reasons for this situation are explained below.
Why are Bellingham’s 2018 rental property rates rising faster than Seattle?
Rental rates in Whatcom County have seen an increase of 5.6 percent from 2017 to 2018 compared to an increase of 4.6 percent over the same time period in the Seattle rental market. Despite growing at a faster rate over the last year, Bellingham’s average rental costs are still lower than Seattle’s by a noticeable amount with an average rental rate of $1,623 compared to $2,204.
There are two key reasons that Bellingham’s rental rates are increasing at a faster overall percentage rate than Seattle’s. These reasons are frustrated Seattle area renters and the lower number of available rental properties in Bellingham.
- Frustrated renters: The City of Seattle remains a popular location to move to; attracting young professionals who wish to pursue careers in the Pacific Northwest or middle-aged people who want to migrate north out of California with its high state income taxes. As a result, many renters have difficulty finding a desirable rental property in Seattle inside their price range so they look in surrounding suburbs and cities. Bellingham offers a different kind of lifestyle to Seattle with less traffic, lower overall cost of living (including rent) and a smaller community feel. This desirability leads people to seek rental options in Bellingham and the demand keeps prices rising. Some Bellingham renters choose to make the commute from Bellingham to Seattle for work where wages are higher while others find jobs inside Whatcom County or in cities north of Seattle.
- Lower number of available rental properties: While Bellingham rental properties are still relatively affordable when compared to bigger cities, rental prices continue to increase at a fast pace due to a lower number of available rental properties. This reality has created a rental vacancy rate in Bellingham of less than one percent for the last several years. With the housing market so hot in Whatcom County it has been more profitable (in the short term) to sell rental properties that have grown in value then to keep them as rental properties. Home buyers – desperate for affordable housing – are more open to purchasing “fixer uppers” to live in that were once used as rental properties.
With developers investing in new condo buildings around Whatcom County in 2018, there is some potential for an increase in the rental vacancy rate and an easing of the pace of rental rate growth.
Son-Rise Property Management has been serving the property management needs of Bellingham and Whatcom County since 1996. Contact us today to see how we can help you find a rental property for your family or manage your rental properties.