Portland Multifamily Report – October 2022
Despite some softening, the market’s fundamentals remain largely healthy.
Portland’s multifamily sector posted steady improvement this year, largely mirroring the national market. Rent gains moderated, to 0.6 percent on a trailing three-month basis through August, on par with the national average, but the movement can be attributed to a typical seasonal softening. The occupancy rate in stabilized properties declined 30 basis points year-over-year as of July, but at 96.2 percent, it is still a tight rental market.
Unemployment stood at 3.6 percent in July, 10 basis points below the state and the U.S. (both 3.5 percent). The employment market expanded 5.4 percent, or 65,800 jobs, in the 12 months ending in June, outperforming the nation by 70 basis points. Still in recovery mode, the leisure and hospitality sector led gains, up by 20,500 jobs. Manufacturing came in second with the addition of 8,400 jobs, aided by the opening of Intel’s latest factory expansion in Hillsboro, where some 2,000 employees were hired in the past year.
Development remained robust, with 3,335 units delivered through August and another 9,967 units underway. Construction starts doubled in 2022 through August compared to the corresponding period last year, but delays are likely to affect project deliveries due to challenges including supply-chain issues and rising prices for construction materials. Meanwhile, transaction activity nearly came to a halt in July, with the total through August at just $727 million, for a price per unit that rose 15.5 percent year-over-year.