It’s ‘hard to watch’ as Boise’s rents soar, property manager says. Here’s the latest
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Affording Boise: Rental housing
Soaring rents. Skyrocketing home prices. The double-digit rates of increase in the costs of Boise-area housing create increasingly urgent problems for low-income, working-class and even moderate-income Idahoans who need places to live. Affording Boise is a series of Idaho Statesman special reports on housing. This collection focuses on rental homes, including apartments. A separate collection focuses on homeownership.
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After a typical winter slowdown in Boise rent prices, an increase could soon be on the way. The City of Trees is positioned to continue absorbing more out-of-towners seeking relative affordability.
The median rent in Boise is $1,026 for a one-bedroom apartment and $1,218 for a two-bedroom apartment, according to data from ApartmentList.com, a national online marketplace for rentals.
The overall median price of $1,245 is a 0.1% decrease from January. But it’s also an 18.2% increase from February 2021. Nationally, the median rent is $1,321, a 17.6% increase from last year.
Since October, the rental market in Boise has been steady, said Rob Warnock, a senior research associate for ApartmentList.com. That followed a standard seasonal trend in the winter. It also led to the year-over-year increase of 18.2% rather than the increases of 30% or more that Boise experienced last summer.
“For now, we’re still in this slower period — not in the middle of crazy rent growth presently,” Warnock said by phone, “but making the comparison where we are today to where we were a year ago, it’s definitely a much pricier market.”
Still, Boise remains more affordable than bigger Western cities, according to ApartmentList.com. The median rent in Portland is $1,364. In Seattle it is $1,825. In San Francisco it is $2,315.
“For better or worse, that difference is what keeps attracting people to Boise,” Warnock said. “A 20% increase in rent prices in Boise might not mean a lot to somebody who’s moving in from San Francisco, but for somebody who lives in Boise, that’s obviously a very impactful change. … The households that are really getting impacted and hurt by that are the ones who are already in the market and struggling to absorb these cost increases.”
Low vacancy rates keep prices high
In the fourth quarter of 2021, the vacancy rate of rentals in Ada and Canyon counties was 1.6%, according to the National Association of Residential Property Managers.
A vacancy rate of 5% to 7% is often considered healthy for a market, said Cassandra Swanson, president of the Southwest Idaho chapter of the National Association of Residential Property Managers. When vacancies are in that range, monthly rents typically increase about $25-$50 when tenants renew their leases.
Now, with the vacancy rate well below that, Swanson has observed renewal rates ranging from $100 to $400.
“What we really need right now is for more rentals to come in and more housing to be available,” Swanson said by phone. “Because as there is more demand, the prices will adjust a little bit. My family’s from here, and I grew up here, so I can definitely see the changes in the community, and it is really hard to watch the housing resources be really, really hard for some to obtain.”
Mike Peña, a partner with Colliers and a commercial real estate broker, said when vacancy rates are consistently above 5% for a few quarters in a row, developers’ interest in building new properties fizzles. When rates top 7%, rental rates tend to drop and property managers may offer months of free rent to encourage people to move in.
The Treasure Valley is far from that point as high demand and low supply persist.
Warnock expects rental prices will tick up as the weather gets warmer and spring arrives. That’s typical in the rental market, as it is with single-family home sales.
“We’re still in the same boat,” Warnock said. “Unfortunately for affordability, we’re still in the period of housing being expensive and getting expensive.”
This story was originally published March 2, 2022 at 4:00 AM.
