Seattle isnt the only west coast US city with increasing apartment prices

[mhays25]

In single-family, sure. Not multifamily. Landlords compete for renters, and renters don't care what the landlord paid.

Rents are based on demand. A rookie landlord might try to overprice at first, but pretty soon they go down to what people will pay.

You don't seem to get economics at all. It's just another jumble of misconceptions.

[CrazyDonkey]

Originally Posted by mhays25

In single-family, sure. Not multifamily. Landlords compete for renters, and renters don't care what the landlord paid.

Rents are based on demand. A rookie landlord might try to overprice at first, but pretty soon they go down to what people will pay.

You don't seem to get economics at all. It's just another jumble of misconceptions.

You're over-simplifying. MFH buildings are bought and sold, and speculated on, just like SFH. No difference, whatsoever.

Every time a building I was in was sold, my rent was JACKED to post-reno levels, forcing me and others out, in order to clear the building. Happened to me three times in 15 years. Nothing juices rents like a building being sold and reno'd (just won't happen in a flat or falling market) - every landlord wants their tenants to at least pay all of their mortgage, other costs, and taxes, with thus any appreciation going directly into their pocket as pure profit when the building is sold again. If that does not "price out", they shouldn't be in the business. That's why vacancies scare them, because they are money flowing OUT.

I'm not claiming that every landlord sets their rents as high as possible. They need a yard stick to go by, however. That's average "market" rents.

Yes, we might eventually have an over-supply, but the actual effect can be very delayed. I remember well the cheap rents of the 1960s and 1970s, especially on Capitol Hill - that was the result of the housing booms here during the 1) post-Gold Rush days, 2) Roaring 20's, 3) two World Wars, and 4) post WWII migration of families to the suburbs. The whole Summer of Love/Hippy thing was based on VERY CHEAP urban rent (over-supply in spades). Lasted until the rest of the Baby Boom started flowing through the pipe, taking up the slack from the preceding Baby Bust, although periodic Boeing Busts here did help keep rents reasonable here for a long time, unlike in S.F. and the Bay Area. Will a future Baby Bust come along to save us? If not for keeping the immigration taps, legal and illegal open - if not for that, with Asians, Hispanics, and other immigrants taking up the slack, we'd be in one now (Baby Boomlet happening in Ballard now, however).

Seattle just topped 700,000 - we've added 184,000 since 1990, 97,000 since 2010. How many units have we added since 2010? Far, far short of the inflow, even with the rabid pace of development, I'd guess.

Rents are very cheap in Wichita, however:

https://www.zillow.com/homes/for_ren...98_rect/10_zm/

[mhays25]

Your rent increases were possible due to the renovations. Otherwise rents rose within the limits of supply and demand.

[CrazyDonkey]

Originally Posted by mhays25

Your rent increases were possible due to the renovations. Otherwise rents rose within the limits of supply and demand.

My rent increases were before any renovations. 90% of the current tenants moved out, which was the whole point.

[mhays25]

Don't you see your logic problem? Come on.

If people moved out, that's supply/demand at work.

[CrazyDonkey]

Originally Posted by mhays25

Don't you see your logic problem? Come on.

If people moved out, that's supply/demand at work.

I'm not disputing supply and demand. What I'm saying is that adding supply only at the top of the market, luxury apartments, by and large, will not necessarily cause rents to go down in other segments, where in fact supply is actually shrinking (due to teardowns and reno's), at least over the short to mid-term.

[mhays25]

That's not how it works. The market is basically a ranking of best to worst, which is obviously complex and personal but the dynamic is there. Pricing is based on where in that ranking a particular unit falls. If the market is flooded at the top, then demand will drop for units just below those, causing them to be cheaper in relative terms. A ripple effect with affect prices at every level.

[cmswazey]

Agreed, Donkey(other than the wayward apostrophe). There are a lot of renovations etc going on. We're doing quite a bit on our one rental. All fixed up and shiny, the rents are higher.