Over-all apartment vacancy rates remain strong in both Kootenai & Spokane Counties as fewer home buyers are able to purchase housing stock. Some, who can qualify for home loans, are sitting on the side-lines until the housing market hits bottom.
The result is mostly positive for apartment owners. Vacancy survey data as reported by the “Real Estate Research Committee” (3/2008) in conjunction with the “Washington Center for Real Estate Research\WSU” reveals that Spokane County’s vacancy rate is a solid 4%. Kootenai County checked in with 4.3% with one exception, three bedroom apartments had a very uncomfortable 16.8% of the units vacant.
The cause of such a vacancy spike for this particular product is directly connected with the current housing crisis. Consider the fact that tenants are able to go into the market place and rent distressed and/or vacant single family homes as an alternative to the traditional 3 bedroom apartment.
Hence, this “Shadow Stock” is draining the tenant pool, who would otherwise occupy our 3 bedroom units.
So, owners, while there is upward pressure on rents in general, be sure to do your homework when you price your next 3 bedroom vacancy. Tenants in today’s market have some choices, at least until the credit crisis recedes and the housing market stabilizes.
Until next time,
Glenn
