The State House of Representatives released its budget late this morning and there is no proposed tax on rental income – commercial or multi-family. Unlike the Governor’s proposal which would have taxed rental income at 1.8%, the House proposal and the Senate proposal do not provide for such a tax.

There are still concerns as though the Governor has toned down his proposal, he is suggesting that the tax will apply to commercial property rental income. But this latest development is a step in the right direction for the rental housing industry.

The Seattle skyline seems to be an ever changing landscape with new apartment high-rises rapidly appearing throughout the city.  One would think that with the surge of new units on the rental market, prices would decrease and renter’s would have more options.  However, this is not the case.  In this market it is clear to see that as supply increases demand quickly follows.  This is bad news for renter’s but great news for the local economy.  The Seattle Times recently published an interesting article that discusses the local rental market and the rapid growth in Seattle.

A few interesting fact from the article I would like to point out are below:

• The Seattle area’s apartment market has only been this tight three other times in the past three decades.
• Just 3.8 percent of apartments in big buildings are vacant in the Puget Sound region.
• Potential for rents to rise 18 percent in King County over the next five years.
• Developers are set to open more units this year than our market has seen in more than 20 years. And they plan to do it again next year and again in 2015.

I agree with Mr. Hagar’s recent article on Seattle’s property values catching up with San Francisco’s. We are having a very tight rental market currently even though in the past years we’ve seen the Seattle slow season between November-February. The big corporate buildings purposely arrange the least amount of lease renewals in these months due to slow business but not this winter. Amazon has steadily been bringing in 800+ people a month and they need homes! With the lack of vacancies and the amount of demand prices are raising quickly. There is a lot of construction in town but will they open up soon to offset the demand, but not quick enough! People have always referred to Seattle as little San Fran because of the similarities but we are growing quicker than we can keep up with and housing prices are reflecting that!

Seattle Council’s Housing, Human Services, Health and Culture committee will be holding a meeting this Wednesday, August 8th @ 2pm at City Hall for discussion of public comment received by the City’s Department of Planning and Development (DPD) regarding their proposal for a mandatory rental housing inspections program in the City of Seattle.

The current legislation Seattle Council will be reviewing would:

• Require all rental housing units to be registered with the City on a tiered basis and beginning by July 1, 2014. Registration would be valid for five years.
• Allow inspections of up to 10% of all rental units in any given year. Require that any property subject to inspection be inspected at least once every ten years.
• Allow inspections of no fewer than two units at properties with 20 or fewer units.
• Allow inspections of no more than 15% of units, up to a maximum of 50 units, at properties with more than 20 units.
• Require that inspectors verify a rental unit meets minimum requirement standards of the City’s housing code related to floor area, sanitation, structural, sheltering, maintenance, heating, ventilation, electrical, emergency escape, garbage removal, extermination, keys and locks, garbage cans, and smoke detectors.

To review the entire proposal, visit http://www.seattle.gov/dpd/cms/groups/pan/@pan/@enforce/@rentalhousing/documents/web_informational/dpdp022247.pdf

In opposition, alternative proposals made by the Rental Housing Association (RHA) include:

• Enhanced landlord-tenant education and outreach.
• A hierarchy of DPD enforcement mechanisms targeting known and knowable problem properties.
• A registration and property condition declaration for all rental properties.
• Random inspections of a small percentage of registered rental properties to serve as an “audit” component.

It will be very interesting to see how this new proposal comes to play and will be updating you accordingly in the future months!

The opening of CityTarget this week in the retails space below The Newmark Tower is a great addition to the downtown area.  Referred to as an urban-friendly spin on the larger retailer, city dwellers can find smaller quantities of basic goods and items specifically designed for urban living.

In an article published by the Seattle Times (http://seattletimes.nwsource.com/html/businesstechnology/2018729175_target22.html) , Kate Joncas, President of the Downtown Seattle Associaion, referenced the clean-up of the Pike/Pine corridor.  CityTarget should be another step towards this clean up and improving the area for current and future residents.  And what an incredibly convenient shopping solution for Newmark Towers and neighboring buildings!