PORTLAND — Portland built thousands of apartments in 2017, helping slow rent increases to levels not seen since 2011. But housing remains out of reach for many in the city, according to an annual report from the city’s Housing Bureau released Wednesday.
It’s the fourth year the city has produced the report, assembled from a combination of city, proprietary and census data. It’s also the first year that covers the period when a city affordable housing mandate known as inclusionary zoning policy took effect.
Developers built some 7,300 homes during the year, most of them apartments. That’s more than any of the past 15 years — about 50 percent more than the year prior and double the number built during the typical year in the 2000s.
The glut of supply helped bring average rent increases to an annualized rate of 2 percent. That rate continued into 2018, the report said. Meanwhile, rent concessions — discounts or weeks of free rent — grew more common.
The city also had a banner year for residential construction permits, with 6,000 permits approved representing homes that could be built in coming years. That includes a large pipeline of projects submitted before the inclusionary zoning mandate, which requires developers to set aside rent-restricted affordable units in market-rate housing developments with 20 or more units.
It remains to be seen how many of those projects will be completed, given an upswing in construction costs and the downturn in rent. There’s also been a dramatic slowdown in new construction proposals in the months since the inclusionary housing policy began.
That period overlaps with other headwinds in the construction industry — the rising cost of materials, a labor shortage and higher borrowing rates among them — but developers have pointed to the policy as a major obstacle that could limit future construction and ultimately push housing prices higher as the population continues to grow.
