There are not too many principles in life that apply to every situation. The reality is usually complex to the point that it limits the usefulness of most principles. But there’s one principle I’ve found that applies to almost every scenario: nothing stays the same.
This statement certainly applies to the city of Seattle. It’s the largest city in the state of Washington, and it’s growing at a rapid pace. In nearly every section of town, there is new residential and commercial construction. New homes are quickly being built to accommodate the new arrivals, and new businesses are springing up to take advantage of this ever-expanding consumer base.
In decades prior, Seattle was regarded as a pleasant, if slightly odd, place with nice scenery and a calm atmosphere. But this assessment is thoroughly outdated. The present Seattle is among the most desired spots in the U.S. for native-born Americans and one of the hottest tourist locations for internationals around the globe.
With this dramatic transformation has come a host of exciting opportunities for you and other investors. The influx of new people has led to substantial real estate development, and much of this has been concentrated in the downtown region of Seattle. Without question Amazon has been the single most important catalyst for the growth in this area. As a result, the downtown Seattle rental market has a lot to interest potential investors, including good demand, rising value, local economic development, and local population growth. Taking a closer look at Seattle’s growth can help potential investors see the reasons why investing in the downtown Seattle multifamily rental market could be a wise choice.
The Statistics Underlying Seattle’s Impressive Growth
The sheer magnitude of Seattle’s growth during the past few years is genuinely striking. Since 2010, the greater Seattle area population has increased by approximately 1,100 people per week! As of April 2016, Seattle proper had a population of roughly 686,800, although there is some speculation that the true number for early 2016 may be upwards of 700,000. In fact, the only city to boast a higher rate of growth at the present time is Austin, Texas.
So what’s the explanation behind Seattle’s impressive gains? There are multiple factors, to be sure, but one stand-out factor is Seattle’s relatively healthy job market. Migration tends to mirror economic development, and Seattle has seen steady job growth during the years it has experienced population growth. People are flocking to become Seattle-ites because they’re hoping to maintain healthy wallets. There is nothing too surprising about this fact. And the relative health of the Seattle job market is something that should interest you too as an investor.
As we’ve talked about before, you always want to be aware of the conditions that surround your investment. It’s not enough to be familiar with the details of your investment itself and nothing more. You have to be familiar with neighboring conditions and trends, you have to be aware of all the things that may conceivably affect the value of your investment in the future. Right now, Seattle’s growth provides good evidence for the desirability of its real estate market. You can be more confident investing in Seattle’s real estate rental market knowing that Seattle’s conditions are attractive to people from all over the country.
The Downtown Multifamily Market Shows Positive Signs
Seattle’s growth and economy are impressive, but what other signs are there to convince you about the desirability of Seattle’s real estate market? What signs specifically point to downtown Seattle as the location you should invest in?
Again, the numbers tell the story in a clear, honest fashion. Seattle will see approximately 10,000 new rental apartments open in 2017. This is nearly twice as many as in any other year in Seattle’s entire history. The majority of these units will be luxury apartments with hefty rents—rents in new apartments run, on average, 40% higher than apartments in old buildings.
Development has been concentrated in the city’s north end, where rents tend to be higher in general. Seattle’s growing tech sector means that new arrivals will have access to high-paying jobs, which will enable them to service the high rents of the newly constructed luxury apartments. Simply put: Seattle’s multifamily rental market is growing disproportionately in its downtown region, and this is happening because there’s a demand for it. Seattle’s downtown area has a clear demand for high-end rental apartments, so these apartments are being added to fulfill that demand.
Overall, the numbers make a compelling case: The downtown Seattle multifamily real estate market presents a solid investment opportunity. Seattle’s growing population means that the demand for multifamily housing will increase in the coming years, and Seattle’s economic development ensures that residents will have access to the funds necessary to pay sizeable rents. Now is an excellent time to take advantage of these trends. CWS Capital Partners is deeply familiar with the Seattle multifamily market as well as other high-growth markets around the country and would be delighted to discuss real estate investment opportunities. Contact us today to get started.
The information provided here is for your general informational purposes only. It should not be considered a recommendation or personalized advisory advice. CWS has made this third party information available from authors it believes are knowledgeable and reliable resources. However, its accuracy or completeness cannot be guaranteed and sentiment may change due to legal or economic conditions.
All investments involve risk including the possible loss of principal. You should familiarize yourself with all risks associated with any investment product before investing.
Advisory services are provided by CWS Capital Partners LLC, a registered investment advisor.
Securities offered by CWS Capital Partners LLC are through an affiliated entity, CWS Investments. CWS Investments is a registered Broker Dealer, member FINRA, SIPC.