Rental prices in Vancouver took tenants on a roller coaster ride last year — and it looks like they’ll be taking another lap in 2023.
In December, Apartment List released its annual roundup report on rental rates and cost-of-living trends in Vancouver. The report highlighted constantly moving rates and the alarming statistic that the city continues to outpace national growth compared to other metro areas — including Portland.
Although some key rental trends in 2022 are expected to carry over into this year based on yearlong trends. But looking across the horizon, renters may see some short-term relief, and last year’s data could help determine which season should be the cheapest to lock in a rental rate this year.
Looking back and ahead
In a recent Department of Commerce and Puget Sound Council survey, residents listed rent as one of the top concerns they’d like addressed in their community. That may come as no surprise in Vancouver, where rental rates jumped 5.3 percent between 2021 and 2022, according to the Apartment List report.
Year-over-year rent increases in Vancouver are currently 4.5 percent, outpacing state (1.7 percent) and national (3.3 percent) metrowide averages.
Rent prices are also up by 27.1 percent from pre-pandemic years.
Analysts blame the higher rents on a chronic shortage of affordable housing, supply and demand mismatches, inflation, and lack of development.
The report said an average one-bedroom in Vancouver rents for $1,352 a month, while renters have to pay an average $1,559 for a two-bedroom apartment. In 2022, Apartment List pinned Washington as the 10th state with the highest rent.
To compare, monthly rents in Portland metro area apartments average $1,252 for a one-bedroom, and $1,462 for a two-bedroom, according to Apartment List. Portland’s rental rate growth over the past year has fallen behind the state average, with 4.1 percent and is similar to the national average (3.3 percent).
In December, Vancouver’s rental rates dipped 0.9 percent from the previous month. In January, those numbers were starting to pick up once again with a slight 0.3 percent increase over the month before — despite nationwide rent prices sinking 0.3 percent for that period.
But a large part of rental fluctuation is due to supply and demand and what time of year people tend to move, according to Mike Wilkerson, a director of analytics from EcoNorthwest, an economic consulting firm.
Looking at data as far back as 2015, Wilkerson said that rent fluctuates throughout the year.
As shown on Apartment List, rental rates in 2022 peaked in August but decreased month by month until January. Wilkerson said this is common, and 2023 will likely fall into the same schedule.
“The time of the year matters a lot in terms of what you see for rent …which is to say even in years where rent is going up a lot — the last quarter of the year typically sees almost no rent increases,” Wilkerson said.
Last year provided an example of what usually happens to rental rates through the year. Rates begin to climb from around March until September, a period that sees more people moving. The increased demand for rental properties means that landlords can change more for their rental units.
Rents then tend to drop steadily throughout fall through early winter and bottom out in November (the fourth quarter).In December, they begin to pick back up again, and the cycle restarts.
“In the summer season, people are moving (because) kids are out of school, etc. But you typically don’t see a lot of movement going on in that third quarter, fourth quarter (fall and winter),” Wilkerson said.
Wilkerson said that average rental rates are not the only method for determining a city’s market prices. Instead, renters should look into how much new product (housing) is entering the market, as that is a more reliable factor of rates.
“The best measure is always to try to get the building levels year over year and then you look at how many buildings are rent going up in based on that,” Wilkerson said.
But for renters hoping to move this year, they should expect similarities to last year.
“Rents will probably start to increase more in the first quarter and then in the second and third quarter you’re going to see rents probably going back to pretty similar rates of increase that we saw last year,” Wilkerson said.
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