Historic Lows for Vacancy Rates—What’s Next?
More inventory is being added to the market, yet vacancy rates remain at historic lows. And that limited availability is causing landlords to increase rents to historic levels, as well. Where do we go from here?
The Word’s Out About Boise
As of March 2021, the median rent across the largest 50 cities in the country rose by 1.1% to hit $1,463. Some of this is due to inflation, but the rising costs of homes also plays a major role. The market in Boise is unique because the area itself has so much to explore. From a great downtown scene, to all of the great outdoor activities just minutes away in every direction, the Treasure Valley is basically the “sweet spot” that offers something for everyone.
Now that more people are able to work remotely, Boise has a clear advantage over larger, tier-1 cities like San Francisco, San Diego, and Seattle. There’s far less traffic and plenty of activities and sights to enjoy. Plus, being able to bring their higher wages means people can afford the rent—even now that the numbers are higher than what Boise has comparably had in the past.
When Will the Rent Growth Stop?
We are constantly having conversations with investors and landlords about how much longer this trend of rent growth will continue. But there’s never going to be a crystal-clear answer. In most parts of the country, the expectation is for demand to level out. Boise is different because we’ve experienced just the opposite over the last 7 years. Instead of dipping back down, the rental market has only continued to thrive.
The rent growth can only stop when the demand plateaus. There’s no real telling when that will come. We still haven’t reached the point when we have empty apartment buildings to fill. So when will people stop moving here? No one knows.
If you’re ready to take advantage of the market and start planning your next project here in the Treasure Valley, I’d love to talk. Just send me a message and we’ll get something on the calendar. I look forward to hearing from you!