The rental rate trend in Bellingham, WA has shown rates going up the last several years. According to data from the Department of Numbers, Bellingham’s median monthly gross residential rent stood at $994 in 2016, a rise of 0.21% from the previous year. (In Bellingham Metro, the median gross rent was $1,007 in 2016). The question is what has caused this trend and how has it affected Bellingham rental property management?
How have Bellingham rental statistics affected rental property management?
The median rent is an accurate representation of rental rates in the middle of the distribution of rents. Gross rent is the total of contract rent and approximated average monthly cost of utilities if they are paid by the renter. The fact that the median rent has been rising steadily affects the type of people applying for and being approved for rental housing by property management companies.
Rental vacancy rate:
Another important indicator in the Bellingham, WA rental housing market is the rental vacancy rate. It represents the fraction of rental houses that are not occupied. Census ACS data indicated that the 2016 Bellingham vacancy rate was 1.82%. This rate peaked in 2009 at 5.86% and has dropped in subsequent years to 4.04% in 2010 and then to 1.82% in 2016.
How low vacancy rates affect rental property management
Low vacancy rates translate to high demand for rental properties. The laws of supply and demand dictate that high demand equals an increase in prices.
When the vacancy rates are high, it means that there is low demand for rental property and rents cannot be raised. A good example of this is in New York City where a lot of new construction is going on.
How rental property management companies can maximize returns
Like all other businesses, rental property management companies should aim to maximize returns. Apart from charging rent at fair market value, property managers must retain good tenants for as long as possible to avoid the expenses associated with finding new tenants. To do this, rental property management companies must keep up with local rental trends such as vacancy rates and invest in property management software that makes tracking rental payments and vacant units, storing copies of rental agreements, service and maintenance schedules and answering tenants questions more streamlined. Rental property management software can also automate the handling of tenant applications including screenings.
Rental property management projected trends
The low vacancy rate trend that started in 2015 is expected to continue with people leaving Seattle for a more affordable housing market; this trend will continue to drive rental prices.
The Comprehensive Housing Market Analysis for Bellingham, Washington was compiled by the U.S Department of Housing and Urban Development. The August 1, 2017 report indicated that the apartment market is tight and anticipated a demand for 1,475 new market-rentals. As units are built it may increase Bellingham’s vacancy rate and soften the increase on rental prices.
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.