A combination of elevated supply volumes and COVID-19-era demand slowdowns have caused Seattle’s apartment market fundamentals to weaken. This market generally experiences cyclical occupancy, with leasing activity tumbling during winter months and climbing during summer, but the market missed out on that typical summer burst in 2020. In fact, occupancy has fallen pretty steadily since peaking near decade highs at 96.3% in March 2020. Less than a year later, occupancy measured 94.2% in February 2021, which is near Seattle’s decade lows and one of the weakest rates among the nation’s largest 50 markets. With occupancy trending down, apartment operators resorted to rent cuts in each of the past 11 months, a price cutting streak not witnessed in Seattle at any other time during the past decade. In February 2021, rents were cut 8% year-over-year, one of the worst performances in the U.S. Price declines were deeper only in New York, San Jose and San Francisco. That’s a big about-face for Seattle, which recorded the second-biggest rent hikes among the top 50 markets less than a year ago, in February and March 2020.
