Local builders placed a bet in 2011 that more Clark County residents would want to live in apartments.
At the same time as single-family homebuilding dropped 32.7 percent, apartment building took off. Construction of new multi-family projects increased 10-fold in 2011 from a year earlier in unincorporated Clark County, according to year-end figures from the county’s community development department.
Developers were issued permits to build 22 multi-family buildings with 189 units, valued at more than $16.1 million in 2011, up from $1.5 million worth of projects in 2010, when just two apartment buildings with 18 units were permitted.
Meanwhile, new housing starts reached a 10-year low in 2011, when just 348 permits were handed out to build single-family homes, a 32.4 percent decline from 515 permits issued in 2010.
Although many would-be buyers of new homes have been sidelined by tighter lending standards, people still have to live somewhere, said Mike Kinnaman, past president and board member of the Building Industry Association of Clark County, which represents about 600 businesses involved in the housing industry.
But the housing industry’s slump has created an opportunity for some construction companies to get back into the business, said Kinnaman, owner of Vancouver-based Designers Northwest home-remodeling company.
“I’m sure it’s been a real godsend to have any projects being built at all,” he said.
Demand for apartments has also been pushed along by a three-year decline in new multi-family development
and an overall drop in homeownership throughout the Portland-Vancouver metro area, said Phillip Barry, a real estate broker who specializes in apartment building transactions with Joseph Bernard Investment Real Estate in Portland.
According to Barry, the percentage of citizens who own homes in the four-county metro area, which includes Clark County, has declined from 69 percent of the population in 2006 to 64 percent of the population in 2011.
New apartment construction is fueled by population growth in the Portland-Vancouver area as well. About 25,000 people moved into the four-county metro area, which includes Clark County, in 2009. The metro area’s population grew by about 17,000 people in 2010.
“All the pieces are coming together,” Barry said, creating demand for apartment units that’s allowed investors — owners of residential complexes — to increase rents and generate more revenue.
“Rents jumped 8 percent within the last year, which is significant. The last couple of years were relatively flat,” he said.
Vancouver apartment developer Elie Kassab also credits shifting attitudes among young adults as a factor in the booming apartment market.
“My research tells me the American dream does not include owning a home anymore,” said Kassab, who plans to break ground this year on Prestige Plaza, a two-building complex with 92 residential units in downtown Vancouver.
Kassab cites mobility as one reason young college-educated adults are choosing to rent instead of purchase their homes.
“Mobility is very important to them,” he said. “People who have good jobs want to be able to pick up and go.”