Yakima apartment vacancy rate improving as construction surges | Local

The number of available apartments in Yakima has rebounded dramatically from last year, according to a recent survey by the University of Washington.

UW’s Center for Real Estate Research conducts two statewide apartment surveys each year, at the end of March and September, and released its spring survey numbers at the end of June.

It showed Yakima with an apartment vacancy rate of 4.6%, meaning more apartments are available than in 2021, which saw vacancy rates of 0.5% in March and 1.1% in September.

James Young, director of the UW real estate research center, noted that while areas such as Yakima and Chelan/Douglas counties have better vacancy rates this spring, the rate can be influenced by the fewer number of agricultural workers needed.

“Yakima County (is) greatly influenced by agricultural cycles, with the lowest vacancy rates traditionally occurring in the summer and fall,” Young said, adding these seasonal factors are why two surveys are taken each year.

Still, the 2022 numbers indicate that a recent surge of new apartment buildings are providing more options for renters, Yakima Valley housing developer Byron Borton said.

“I think (the survey number) is probably accurate. There’s been a lot of new (apartments) hitting the Yakima-area market in the past year,” Borton told the Yakima Herald-Republic in a Tuesday, July 12 interview.

Last year, Young noted that a normal vacancy rate for apartments is about 5%, allowing a decent number of units to choose from for people moving into or within a community. A “tight” rental market has a vacancy rate below 4%, and an “extra tight” market is below 3% — meaning Yakima’s recent vacancy rates were extraordinarily low.

The apartment shortage trend in Yakima predates the COVID-19 pandemic. According to the UW surveys, the overall vacancy rate for all types of apartments was 4.7% in March 2009, then fell into the 2.5% to 3.2% range over the next two years.

It rebounded to 5% twice between September 2011 and March 2013 before falling below 3% from September 2013 through March 2016, then dropping below 2% or even 1% since 2016.

Low numbers of available units and the continued demand from renters prompted developers to build more apartments, Borton said.

He is building more than 100 apartments in the Powerhouse Flats development near Fred Meyer in Yakima, and is planning to begin construction next year on the Goodman Place apartments in Union Gap. Those developments and other apartment construction in recent years is “absolutely” in response to the lack of available apartments, he said.

“These (developments) take a long time to get off the ground. I’m doing the planning and approval for them about 24 to 36 months in advance of building them,” Borton said.

“The trick right now is how do you build a project in this environment, with the rising costs we’re seeing, and still make it pencil out at a somewhat affordable rental rate? That’s what we’re all dealing with,” he added.

Details from spring survey

The UW report surveyed 2,977 apartments in Yakima, finding an average monthly rent of $797, an average size of 757 square feet, and 137 vacancies, for a vacancy rate of 4.6%. These figures include studio, 1, 2- and 3-bedroom apartments.

“With all unit types analyzed, the influence of apartment mix plays a significant role in determining the average rent,” Young said. “For example, King, Walla Walla and Yakima counties have a proportionally high number of 1-bedroom and studio units, which will provide downward influence on overall rents compared to places with a high proportion of 3-bedroom units, which tend to rent for a higher amount.”

After noting those influences, Young said Yakima County had the second-lowest average rent among the 17 areas surveyed in the state, just behind Whitman County’s $728/month average rent. King County’s rent was the highest in Washington, averaging $1,936 per month.

Young added that his twice-a-year report only includes apartment units from landlords and management companies who respond to the survey. Yakima County’s response rate often includes 20% to 30% of apartments, meaning the 2,977 apartments in the spring 2022 survey is only a sample of the total amount available.

Still, Young said his survey, which showed a statewide vacancy rate of 3.8% for all types of apartments, gives an accurate picture of the Evergreen State’s rental situation.

“While vacancy rates are falling in the Puget Sound region as the economy opens up from COVID-19 restrictions and increasing stabilized supply, most other counties are seeing continuing tightening of the rental market as new rental supply has been slow to materialize, and demand has increased sharply,” he concluded.