Last March, the Bellingham Herald published an article discussing the very low vacancy rates of rental properties in Bellingham, WA. The story was based on a study completed by the Runstad Center for Real Estate Studies at the University of Washington which found that Whatcom County’s vacancy rate was down to 1.7 percent in October 2012, falling from 2.2 percent the previous year. The housing crash stopped some of the natural development that would have occurred and with an ever growing student population, the demand for rentals is high. Although vacancy rates are dropping all over the country, the national vacancy rate in October, 2013 was 4.2 percent. Typically the apartment rental market is considered normal when the vacancy rate is about 5 percent.
Vacancy Rates in Bellingham, WA
The average monthly rent in Bellingham is $801 which is $19 higher than the year before. In general, however, rental rates have not kept pace with the low vacancy rates as stagnant wages and a weak job market have dampened renters’ ability to pay a higher rate.
There is a glimmer of sunshine in the numbers. According to Glenn Crellin, associate director at the Runstad Center, low vacancy rates are a sign of a healthy economy. He says “the increase in apartment occupancy and rent is partly a byproduct of an improving economy. As the job situation improves, families that moved in together as a result of the recession to save money are now looking for their own places. Recent college graduates that had moved back in with parents while looking for work are also more apt to look for their own apartment after finding work.”
Signs of the healthy rental market could be seen over this past summer’s construction season with more than 450 apartment units under construction or in the design and permit phase. The units are scattered throughout the city including the 112-unit Cornerstone building in Barkley Village, a 60-unit building near Depot Market Square and a 38-unit building on North State Street near Boulevard Park. The new construction will help to keep rental rates in check to avoid monthly mortgage payments becoming less expensive than rent.
Thirty years ago more than half of Bellingham’s families owned a home; today its 48 percent with one third more families renting in Bellingham compared to those living in the rest of Washington State. Many of these families rely on subsidized housing or rental vouchers to make ends meet but it can be a challenge. The wait for subsidized rental units can take as long as 6 ½ years and the wait for vouchers is over two years. Over one third of renters are spending more than 50 percent of their income on rent; it is not recommended that more than one third of your income goes to rent.
The city of Bellingham is aware of the long waits and is committed to increasing the supply of subsidized rental units.
• The city recently allocated more than $600,000 in HUD funds to rehabilitate five Bellingham Housing Authority apartment buildings with 223 units.
• Bellingham has also committed more than a quarter-of-a-million dollars to help 20 or more elderly or low-income homeowners bring their houses up to code, keeping them viable and in the market.
• The city has partnered with the Kulshan Community Land Trust to purchase property for development of affordable single-family homes. These homes will remain affordable going forward due to land trust requirements.
• The city is building new, affordable housing.
Bellingham is a beautiful place to live with a real sense of community. The trick is in finding a good job to pay the bills and a nice place to call home.
Check out our property listings today!