May 5, 2023 - Real Estate

Portland's high rise in high-income renters

Data: RentCafe; Chart: Tory Lysik/Axios Visuals
Data: RentCafe; Chart: Tory Lysik/Axios Visuals

Apartment developers looking to attract high-income renters say they're thinking beyond gyms and pools when it comes to amenities.

Why it matters: The push comes as many would-be homebuyers rent longer due to macro housing trends across the country. This incentivizes properties to compete for a growing demographic of high-income renters, Axios' Sami Sparber and Tory Lysik report.

What they're saying: "Our approach is to make a more intimate experience for residents," Amy Einstein, director of asset management at Edge Development, told Axios Portland. "Residents like to feel like they're living in a small community instead of in a building with 500 other people."

  • Sometimes luxury can be as simple as providing access to green space, Einstein said. Properties with exterior corridors offer tenants the ability to garden and sit outside without having to pay extra for a patio.

By the numbers: The number of Portland metro area renters earning $150,000 or more grew 127.8% between 2016 and 2021, according to Axios analysis.

  • That's higher than the national increase of 87.5%, per U.S. Census data.

My thought bubble: The median selling price for a home in Portland is $502,000, according to Redfin. Comparing that to the median monthly rent for a two-bedroom at $1,450, it's easy to see why folks are keeping an eye on the market while lapping up amenities in the meantime.

The big picture: Apartment construction is booming nationwide. Historically, new rental housing tends to hit at the higher end of the market, Chris Salviati, senior economist at Apartment List, tells Axios.

  • That trend has become more pronounced in recent years as rising project costs squeeze developers, he says.

Between the lines: High listing prices and mortgage rates aren't making home buying as desirable as it once was.

  • "With interest rates going up and housing affordability being so tight, people have to rent, and salaries are increasing, so this is just an outcome of the market," Einstein said.

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