Portland Multifamily Report – February 2022

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Despite a seasonal slowdown, the city is registering solid fundamentals.

Portland rent evolution, click to enlarge

Portland’s high quality of life and relative affordability compared to other Western coastal metros helped its multifamily market throughout 2021. Rent growth dropped abruptly to 0.3 percent on a trailing three-month basis through December, to $1,635, but a slowdown was in the cards, following a strong year. The occupancy rate in stabilized properties rose 1.0 percent in the 12 months ending in November, to 96.2 percent, reflecting a tight rental market.

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Portland sales volume and number of properties sold, click to enlarge

The unemployment rate dropped from 6.7 percent in January to 3.2 percent in November, according to data from the Bureau of Labor Statistics, surpassing the U.S. rate by 100 basis points. The employment market registered a 6.0 percent expansion (60,000 jobs) in the 12 months ending in October, 70 basis points above the national average. Professional and business services led gains with the addition of 16,800 positions, followed by leisure and hospitality (15,500 jobs). The latter might be further impacted as the number of infections has been steadily rising.

Developers brought online 4,850 units in 2021, 79 percent of which were in Lifestyle properties. The new inventory expansion is the equivalent of 2.9 percent of total stock, 60 basis points above the U.S. average. Another 9,029 units were under construction. Meanwhile, investment volume totaled $1.8 billion in 2021, up 33.6 percent from the prior year, and the price per unit rose 9.7 percent year-over-year to $256,843.

Read the full Yardi Matrix report.

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