Crane-Counting in Seattle: Something Has to Give

There are 67,507 apartment units in various stages of the pipeline.

It’s kind of hard to wrap your head around this apartment construction boom that started in 2012: In the Seattle area, there are currently 23,572 apartment units under construction in large buildings of 50 or more apartments. Of them, 58% are in the city of Seattle, 24% on the Eastside (suburbs east of Lake Washington), 9% in Snohomish County to the north of Seattle, and 9% in South King County.

This year alone, 11,660 units in these large buildings have either been completed or are scheduled to be completed, according to Tom Cain, of Apartment Insights, whose database tracks buildings with 50 or more apartments (so not including smaller apartment buildings and single-family homes and condos on the rental market). In the report, Cain adds:

We have preliminary information for the next several years. We are tracking 14,293 units that are scheduled for a 2018 completion. For 2019 the count is 7,053 units, a number that will increase as we get closer to 2019.

The grand total for all of the units in various stages of the pipeline is 67,507.

The last three years have seen near record-breaking levels in excess of 9,000 units per year. 2018 appears to be a monster year for new construction.

And crane counting has become a thing. David Calder commented on WOLF STREET:

Last count, a few weeks ago, we had 61 cranes in Seattle with many sites waiting for new cranes to arrive.

Paul Allen’s Vulcan [Vulcan Real Estate, part of the Microsoft cofounder’s investment empire] is still buying and still plans on ripping up whole blocks in the Central District, evicting many.

Plywood signs on lots all over the city are proclaiming some new high-rise catering to those with big paychecks. If there is an end in sight in Seattle, none of us on the ground here can see it.

In the second quarter, 2,340 units were absorbed by the market. In other words, landlords found someone with a paycheck big enough to rent the new unit. This absorption rate matches approximately the annual rate of completions over the past three years of 9,000+ units per year.

But in 2017, a total of 11,660 units are likely to be completed. And in 2018, so far 14,293 units are scheduled for completion. In his report, Cain says: “We expect it to ease the pressure on rent increases.”

But that hasn’t fully happened yet.

In June, the median asking rent for one-bedroom apartments in multi-family buildings of all sizes rose by 7.9% year-over-year to $1,910, essentially matching the record in May, based on data from Zumper; and for two-bedroom apartments, rents rose by 4.2% year-over-year to $2,500. It made Seattle the eighth most expensive rental market in the US.

Cain, looking at his data set of buildings with 50+ apartment units for the second quarter, comes to similar conclusions. Rents in these buildings surged 7.6% year-over-year to $1,667 per month, and $2.01 per square foot. They ranged from $1,193 ($1.53 per square foot) in Des Moines to $2,393 ($3.02 per square foot) in downtown Seattle.

And rental incentives dropped on average to $7 per unit per month, from $13 in Q1. Only 14% of properties offered incentives in Q2, down from 21% in Q1.

Calder, from his boots-on-the ground view, sees the rental situation in Seattle this way:

I’ve been on a voter drive and have gotten to see how many renters live. These aren’t one bedroom but one room rents with a tiny side room that passes for a kitchen in a 1920 building; $1,700 and going up. All of the $4,500 one bedroom places on Broadway (Capitol Hill) are rented.

The vacancy rate in Q2 in “stabilized” buildings (buildings that have reached stable occupancy) in King County, which includes Seattle, and Snohomish County ticked up to 4.2%, from 3.9% in Q2 2016, according to Cain of Apartment Insights.

When properties in lease-up are included (the period for a new building when it tries to attract tenants to reach “stabilized” occupancy), the overall vacancy rate for both counties rises to nearly 6%.

Shocked by these rent increases? Home prices increased even faster, with the median price in King County soaring nearly 13% year-over-year in May, to $632,250, according to the Northwest Multiple Listing Service, cited by Cain. He added:

“These high price levels and the low inventory of homes for sale are making it difficult for most tenants to leave the rental market.”

“We thought the rate of rent increases would drop off a bit this year in the face of all the new construction. That doesn’t seem to be happening, at least at the midyear point.”

Despite the sizzle in Seattle, the prices of apartment buildings nationally, after seven dizzying boom years, peaked last summer and have declined 3% since. Transaction volume of apartment buildings has plunged. And asking rents, the crux because they pay for the whole construct, have now flattened – with sharp declines in San Francisco, New York, and other expensive markets, and big surges in “mid-tier” cities. Read…  Apartment Rents Drop as Commercial Real Estate Sours.

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  73 comments for “Crane-Counting in Seattle: Something Has to Give

  1. tony says:

    Years back the working crane in hawaii was called the national or state bird.Now there are more birds in new jersey then hawaii,i think there are more birds almost any other place then hawaii. They have even increased hight limits in honolulu so the nationl bird is coming back.

    • Frederick says:

      The birds are all dead in Hawaii because of radiation levels Sadly they won’t be coming back for 10 k years or so

    • Lee says:


      Where are they building now?

      Are they still concentrating in the Waikiki – downtown Honolulu areas?

      I don’t think I’ve seen anything big go up from Kahala out to the Hawaii Kai area. I think that those two tall buildings out by the Kahala Mall are still the tallest out there…

      But how do people in Oahu make money buying and renting out properties? The monthly condo fees and lease rent are huge even before considering all other costs.

      Has the State increased property taxes? They used to be the only really cheap aspect of owning something there!

      What does electricity cost now? I know that most condos include water and sewer with the fees and a few also include A/C, but still…………

      • Bee says:

        I’ve heard it’s cheaper to live in Hawaii than Illinois with Illinois’ outrageous property taxes. On that note, Illinois’ income tax will be going up to start payment on their $15B in debt—‘junk’ status to follow?! Waiting on midnight…

      • Realist says:

        We recently lived in Hawaii for a year. Rented a 1100 square foot place and only ran the air conditioner at night so we could sleep. The bill would be about $290 per month. In other words, outrageous.

        • alex in san jose says:

          Realist – that’s like commercial electric rates in San Jose, California.

          I live in a 140-foot-square office, cook on a hot plate, have a half-height fridge/freezer (actually a little Frigidaire unit I love, that I traded for in money and ammo boxes) use a laptop computer, no a/c, no TV only a radio, in other words, my electricity usage is very low. But on a low month my part of the electric bill is still $30-odd.

          When I had an apartment and lived normally my bill never topped $20.

      • tony says:

        They are adding on more levels of existing buildings in waikiki.Most lakes are polluted the vog from the big island comes in more often and stay’s longer wind dies down and it gets like florida.Property taxes are still good but everything else there m akes california look cheap.

      • junior_kai says:

        You forgot about the *insane* traffic – worst in the nation. And theres little to no parking unless you want to pay an arm and a leg. I have no idea how people make it, and many are not – homeless everywhere. But they keep on building, and raising taxes, all the while the quality of life declines. Fortunately I just read about it and dont have to deal with it personally. Too expensive, even for a short visit.

        • alex in san jose says:

          I grew up there. It’s just a place where you have to work, work, work, all the time to survive. Living like a local helps – no car, learn to love DaBus. Live in something like a 3rd-floor walk-up. Eat local foods. Shop at “da Goodwills”. And so on.

          It’s a friggin’ island in the middle of the ocean. I don’t know why that politician got in hot water for saying that, that’s what it is. Very limited job prospects. Very limited everything prospects. A very mixed bag of everything from Scientologists to crazy type Christians and all pretty in-your-face. It’s kind of neat that on the Mainland, if you want to join a bunch of loons, at least you have to go looking for them. In Hawaii it was my dentist when I was a teen trying to convert me in the dentist chair while he worked on my teeth to his brand of crazy Christianity. Later, my barber trying to sell me on Scientology. As a pre-teen learning all about the local “More House” – that’s a cult called “More”. One of my dad’s girl friends being connected with the Theosophical Society. And that’s just scratching the surface.

          Lots of casual racism. White privilege is not a thing there. Not at all. Lots of just small-town cliquishness too. Where you went to high school is a big, big deal.

          It’s not bad for retiring though. Lots of pretty affordable places for older people, lots of walkable infrastructure, and culturally, older people are much more respected there than on the mainland. I would actually consider retiring there but ….

          My plans are to retire to Israel. All the fun of Hawaii plus a crazy backwards-reading language and rockets!

        • Lee says:

          Yeah, the last time I was in Honolulu the traffic was pretty bad, I’m sure it’s worse now.

          Guess we were lucky in that every time we visited there was no vog. Did manage to miss the couple of times big storms hit – once on Kauai and once in Waikiki.

          If we hadn’t got our visas to Oz, the two alternatives we were considering were Hawaii and the other Florida – Marco Island.

          I doubt that I’ll ever visit Hawaii again, but if I did I would stay away from Waikiki and if I were to visit Oahu I’d consider the North Shore or Makaha.

          I prefer Maui to all other places in the State and on the Big Island I really liked the Mauna Kea Beach Hotel.

          Loved Hawaii when I first visited there 38 years ago, but too much has changed – too crowded, too expensive, and too far to go. Wouldn’t want to put up with the immigration crapola for the better half either.

          Used to be able to go through the “Citizen” line as a family, I doubt that we could do that now.

          And as the article is about Seattle, sorry I didn’t like the place when I visited and when I was Fort Lewis, I didn’t like that place either!!

  2. Willy2 says:

    – It reminds me of what happened in the canadian city of Calgary. During the oil boom (2006 – 2014) there was some 12 million square feet of office space build. And now A LOT OF that office space is empty.

    Watch this video:

  3. william says:

    Considering a move to Seattle, I calculate the cost of renting vs. owning downtown (with no car). If I put 20% down on a condo, my mortgage payment will be nearly equal to renting a comparable space.

  4. interesting says:

    “All of the $4,500 one bedroom places on Broadway (Capitol Hill) are rented”

    that’s $54K a year in just freaking rent…..where are people getting all this money?

    • David Calder says:

      Not any of my friends.. The Seattle Times and The Stranger had articles about a year ago, maybe longer, that this new wave of techies were making $60 an hour which come to $124,800 but that doesn’t factor OT or holiday pay.. I understand Amazon and the other’s business models but what I don’t understand is why this had to be concentrated in one city? If this is the age of the internet then this could have been spread out over a dozen or more places. That is until one realizes that these billionaires have bought up enough land in one city to equal good sized farms and are making money farming their own neighbors, citizens, and their own workforce. For some there is never enough..

      • Petunia says:

        Bill Gates and his foundation have been buying up large tracts of land all over Florida for at least 5 years or longer. There was a lot of talk a few years ago that Microsoft was going to expand in south Florida, but I never saw any evidence of it. People were saying they wanted to relocate to a cheaper area for their employees. I think they still hold the real estate.

      • RangerOne says:

        Tech Hubs make it easier to get an influx of talent. There is lots of poaching going on as everyone is working on similar stuff. So concentrating tech hires in major cities and near major colleges cuts down the difficulty and probably cost of recruiting.

        Location is also part of the draw and appeal of bringing in engineers. Some may be more willing to relocate if they know the area is generally opportunity rich. Turnover in the tech industry is about 3-5 years for any 1 employee so they expect to not have to move cities with every job hop.

        • RR. says:

          I think you are correct.
          Boeing was not Bessemer Steel, and the high tech
          mentality had a Foundation and a Foothold.
          Bill Gates happened to be from “Across the Lake”,
          and kept his operations at home. Boeing wandered
          off to Chicago, disgusting the vast majority, but the
          seeds were planted. (Also the Asian Gateway
          Mentality probably plays a role)
          Maybe someone will someday write the history,
          and pinpoint the exact beginning to when Bill Boeing
          stopped making airplanes from wood, and changed
          to Aluminum.

        • MC says:

          One of Bill Boeing’s many strokes of genius was shifting from wooden spars to welded steel tubes, which was done far earlier than many believe, the Model 15 prototype flying in 1921 already.
          The Model 15 was a big hit by post-WWI standard, with both the USAAC and the Navy buying the type in quantity, but when Boeing proposed the same construction to be used in a mailplane, the US Post Office balked at the novelty despite glowing reviews from the military and demanded wooden spars to be used in the wings, albeit Boeing managed to sneak in some aluminum skin for the fuselage.
          Boeing’s first all metal plane was the 1930 Monomail, yet another mail plane. Only two were built, not so much on account of technical issues but because the engines and propellers available at the time were not deemed sufficient for such an aerodynamically advanced aircraft.
          Boeing then decided to shift to multi-engine construction and the result was the all-metal 247, which entered service in 1933, making previous airliners such as the Junkers Ju52 obsolete overnight and which spurred Douglas to build the DC1.

        • QQQBall says:

          Good points, maybe you lose some employees in the move to Fl. But the employees can buy a home and do not pay state taxes. Look for more relocations as we go forward… Maybe MSFT is a bad example, but many firms have global competition that do not have to pay $100k + bennies per year

      • RangerOne says:

        What I would really love to see from this site is some kind of brief analysis of the frequency of the rise and fall of housing prices in a market like California. It doesn’t necessarily take a “2007 bubble” to bring home prices down and that seems to be point quickly glossed over by real estate people in their interviews and blogs.

        It seems to be a fairly difficult task to find a good general measure of historical home values to help guess what the future could hold given there are many ways to cut up the housing market.

        For instances I was looking at the common Case-Shiller index from 1890-2013 and if you looked only at this measure you would conclude that 2007 was a uniquely terrible event unlikely to get repeated without major red flags.

        But if you look at a different measure like the Crandall series measuring new home prices over the same period if appears that 2007 wasn’t an isolated event at that their have been periodic booms and busts over the last 100 years.

        In California I feel a constant push to buy now or be priced out. That is at least the prevailing attitude among most people. Those of us who frequent bubble blogs and more realistic/pessimistic financial blogs seem to be the only ones trying to shirk this narrative.

        • tony says:

          From what i have been told by a few people in california it takes two years after a downturn to effect that state.

        • Wolf Richter says:

          I don’t have median home prices for all of California. But I have them for San Francisco.

          The median home price in SF peaked in November 2007 at $814,750. Over the next four years, it plunged 27% to a low $594,000 in December 2011. Then over the next 3.5 years, the median price more than doubled to $1.4 million by May 2015. Then for two years, it flattened out with a slight downward trend, until May 2017 when it spiked to a new record (this may have been a statistical quirk… we need to get confirmation over the next six months… this data is very volatile and seasonal).

          Here’s my article on the May spike with a chart going back to Jan 2012:

          And here’s my article on Bay Area employment and labor force that peaked late last year and have been declining ever since:

      • junior_kai says:

        Scamazon and the rest are making what little money they are off the social media bubble. There’s no “there” there. When the last part of the facade melts away the so called tech giants will go down with the tulips, just like in 2000. Bank what you can while you can kiddies, its going to be a rough ride going forward.

      • mike says:

        Getting paid for OT? Are you dreaming? I have not got paid for OT since 1984.

        • Petunia says:

          I was thinking the same thing. I never got paid overtime, never. Once I signed a time sheet with so many hours the accounting dept. complained. It had one stretch of 24×4 hours and the rest was just as bad. OT, I only wish.

          On my first tech job I resigned when I realized I was making less on an hourly basis than the receptionist.

        • alex in san jose says:

          Petunia – my first “real” job (out of college) was with a large tech company that’s still large. I was making less than the warehouse guys and they got to drive forklifts.

          Now I make less than the guys who get to wear neat badges and stand around shooting the shit with the local hobos at the convenience store/gas station up the street. I don’t think they even need a HS diploma or … sanity … one of the guys is a real loon. He’s fun to talk with, but I honestly think he’s a 12 year old in a man’s body.

      • Ethan in NoVA says:

        Because they want to be far away from DC? Heh. The tech boom pricing can be found in Northern Virginia, in Austin, in Cali, in Boston. It’s not just Seattle. It’s probably schools / talent / infrastructure and where the venture capital is. The VCs aren’t willing to live in crappy places, and they like their companies to be somewhat close.

        Go to crappy geographical locations you also end up with more crappy bosses/managers.

      • Shawn says:

        The FAANGs and Tesla have been pumped up by the stock market which has been pumped up by the FED. Their businesses are only worth a fraction of what they are valued.

    • Nick says:

      Amazon is based in Seattle.

  5. David Calder says:

    Thanks, Wolf.. I haven’t bothered to check single home prices because I know none who can afford to buy a house in Seattle.. One side hobby I have to is to chronicle with my Canon the changes while doing a voter drive. One older corner lot house in the U District, across from the Seven Gables theater is scheduled for a 7 story high-rise with 60 residential units with shops on the street level. The tallest buildings in the neighborhood were nothing over three stories with lots of single family homes. How can 60 units be crammed onto a lot that held one house?
    One thing that Seattle has going for it, if this can be considered a positive, is Amazon’s model will destroy retail in every city in America. Just as Walmart wrecked small-town downtowns and Amazon made book stores a thing of the past, if Amazon is successful at e-commercing everything then everything is at risk and that money will flow here and not stay where it normally would have been spent.

    • DH says:

      I know someone who just bought a home in Seattle a few weeks ago, but he had quite a journey. He was self-employed and bought a little house in LA in 2011. He then got a job at Apple and used the money made on the LA house to buy in San Jose. After being at Apple a few years, he just got a job at Microsoft and rolled the money made on the San Jose house into a place in the Ballard area in Seattle.

      The lesson here? We should have all bought houses in LA in 2011. lol

      • David Calder says:

        Ballard is just now starting to fall under the wrecking ball.. Any town within commuting distance to Amazon, Microsoft, and the new biotech campus in South Lake Union will be forever changed into a bedroom community. The entire route of the Link lightrail is lined with expensive condo and apt. buildings forcing up prices and rents in what were once blue collar neighborhoods.. Ballard is or was blue collar with a large fishing fleet (think Dangerous Catch) but that is going change when the fishermen can no longer live near their boats.

        • Rocco says:

          Lololol…Ballard hasn’t been blue collar in a decade. Seattle is a neoliberal experiment gone wrong. From a ground level perspective the income inequality is insane. My wife and I combine to make well over the 6 figure mark and there are areas of this city I simply can’t afford to hang out in(i.e. Ballard, Belltown, queen anne…etc), because of this we’ll be moving to tacoma next month(where i do most of my shopping and entertainment anyway). I-502 and an increase in minimum wage was the magic pill that was supposed to fix all this….but the schools are no better than 2012, the roads are worse, $15 an hour still doesn’t pay for survival in the city and my friends who used to pay there mortgage selling weed they grew on their property are now mostly broke. Many people only look at the numbers and don’t see how detrimental I502 has been to the real economy, but thats a story for another post.

  6. Seattle Cranes says:

    Thank you for the article. I am right in the middle of the construction war zone here in South Lake Union. My old 1950 building is surrounded on all four corners with residential high rise construction. Most are going to be aparments. I saw one condo high rise lot slated for construction & there was a line around the block on the 1st day of sales. 80% of the units reserved & they will not be ready for 2 years.

    • jb says:

      any insight why the bulk of ‘living units” being added to supply are apartments, not condo’s ? . I believe the converse is true in Miami. maybe fannnie /freddie multifamily underwriting ?

      • Wolf Richter says:

        Fannie/Freddie guarantee commercial real estate loans for apartment buildings and package them into Commercial Mortgage Backed Securities. It’s part of their businesses. They’re thus deeply involved in the apartment building boom.

      • Petunia says:

        At some point the big employers will have to enter the residential real estate market in order to attract and retain employees. It is easier to sell one large property, especially already filled with their workers, to some large employer. Ransomware.

        In NYC some of the private hospitals and colleges own large numbers of buildings, they need to in order to house staffers. It is considered a big perk. The minute you quit, you lose your nice and cheap apartment.

    • RR. says:

      It is so many years ago, and I have been gone so long.
      I used to work at Lake Union Terminals (Columbia Wards Fisheries),
      and even had a 27 foot sailboat moored some of the time on Lake
      It is better I stick with keeping my memories.
      (Good Luck in the Big City)

  7. hidflect says:

    It’s also a matter of quality, not just quantity. I’m not talking about build but intended use. For example, I hear that many of the apartments built in Sydney for off-the-plan sales are virtually unlivable in design, only being constructed to serve nothing more than the display brochure.

    I stayed in something similar for 6 months myself. Open plan, 1.5 bedroom units that offer virtually zero privacy to the occupants from each other. The kitchen 4 meters from the 55 inch TV which is 4 meters from the stressed wood style dining room table which is 4 meters from the front door. All the brushed aluminum accents and down lights in the world can’t save you from the feeling of living in an office block foyer.

    Unless your single or a childless couple, it would be exhausting to live there for any period of time over 8 months – year. I could only take 6 months of it even though I lived in Japan for 15 years. The West generally has no history to back the concept of ergonomics for small spaces. The tenancy turnover on these places will be huge.

  8. IdahoPotato says:

    Don’t people want backyard gardens anymore? To grow berries or tomatoes, or just dandelions?

    Does everyone want to live in a box? Structures depreciate, land doesn’t. Why would someone pay so much for a condo without any land to go with it? Don’t get it.

    • Wolf Richter says:

      Some people love living in the middle of a big city – we do too. I walk everywhere I need to go. Great cities have a lot to offer. We seek out nature when we take off. Great hiking is 30 min by car (Mount Tam with gorgeous views) or 4 hours to Yosemite or lake Tahoe. Nature is also just down the street… I swim in the Bay nearly every day, along with sea lions, pelicans, and the like. It’s just a matter of preference.

      • Lee says:


        You left Japan for SF?

        Ever think about going back?

        Japan now has cheap RE outside the big cities and believe it or not , it is cheaper to live there than here in Oz.

        Probably less traffic, better trains of course, safer, and nicer people!!

        • Wolf Richter says:

          Yes, but my wife, who is Japanese, refuses to live in Japan. She – as a woman and as a Japanese – doesn’t have the subtle freedoms in Japan that she has here. She’s a free spirit. And in Japanese society, that is not welcome. You have to repress that free spirit. Which she does when she is there since she had to fit in (I’m a gaijin, I can do pretty much whatever I want, and they’ll forgive me, but they won’t forgive her). Even her voice changes. It takes on a higher pitch and become obsequious.

          She loves being there for a week or two, but that’s about it.


        • Lee says:


          Same ‘problem’ with me: I’d go back in a second, the better half, who is also Japanese, won’t for the same reasons.

          Don’t know what is going to happen here in Melbourne as it isn’t the ‘same place’ we moved to when we first came here:

        • hidflect says:

          Agreed. Last night, I got takeaway sushi here in Oz. 8 pieces – $23. In Japan, that would be real sushi and cost about $8.

      • IdahoPotato says:

        I live in condos for the first 25 years of my life and gradually I have “evolved” :-)

      • RR. says:

        Wolf, in the small town here in Germany where I live,
        (Eschenbach, an hour east of Nürnberg) we have a
        Restaurant named Maki Maki. The Wife is Japanese,
        and the Husband is Korean. With the Racism that
        can get going in all directions with that combination,
        I have never figured out how they got together. Even
        though we are friendly, I have never had the nerve to
        ask. As their parents are here too, I have been
        suspicious that Racism and Contempt at home pushed
        them to move out to a place where “An Asian is an Asian”

        Und Ich Wünsch Ihnen Ein Schönen Tag,

    • polecat says:

      No, not everyone …. just the metro man and gal, who live the other portion of their lives in a office cubicle.
      As for a garden … or backyard .. who wants that ! /sn

  9. Bobber says:

    The companies in Seattle are growing their presence in the costliest areas, like downtown, for a reason. It attracts employees who like condos and city living, and they are generally the youngest and cheapest workers. The companies are pruning the older family oriented folks from their work force via their location.

    • philbq says:

      The young workers are willing to work crazy hours, while the older ones want to see their family.

  10. michael says:

    My wife has specified she would prefer a buffer of at least 5 acres or more between us an the neighbor. She prefers deer to people.

    • Coaster Noster says:

      I took that philosophy in 1977 when I bought five acres in the Sierras for $12,900. There was a movement pushed by a book, “Five Acres and Independence”. But then I got a partner that talked the five acres as a good idea, but our neighbors were all gun-touting reactionaries.

      She had me come back down to the Bay Area, and…well, did not return to live in the mountains.

      • alex in san jose says:

        Ask me anytime about the “5 acres and independence” and survivalist/prepper types; I lived for a few years among them on the quintessential 5-acre prepper place.

        The preppers have some outstanding ideas. But like any cult it’s a catchment trap for loons and those who don’t play well with others, and and yes, in the US if you’re living in any rural area, you’ll be surrounded by people who think Alex Jones is OK, for a liberal.

  11. Raymond C. Rogers says:

    Just listening to people opine about these housing markets just causes me to think about municipality revenues. The municipalities must be swimming in cash. I wonder if anyone has done any analysis on cash inflows of these cities and larger areas.

  12. Some Guy says:

    “Last count, a few weeks ago, we had 61 cranes in Seattle with many sites waiting for new cranes to arrive.”

    Last year there was 150 cranes in Vancouver, must be a lot more now. I laughed when I read 61, I must pass 15-20 on my drive to work, which only covers a tiny portion of the region (obviously).

    As for construction, there is currently over 41,000 units under construction in the Vancouver area, ~34,000 apartments, ~7000 ‘ground oriented’.

    Not sure what in the pipeline means – the mall down the street has plans to build 23 condo towers to house 10,000 people on its (admittedly large) parking lot, but they only have the first couple of towers (first one is 55 storeys tall ) under active development at the moment.

    • Paulo says:

      My parents were refugees from cold Minnesota winters, moving to Walnut Creek in 1954. I was born there in ’55. By the early ’60s it was already in decline, with once rolling ranchlands slated for sub-divisions and golf courses. In’63 they bought a small property on Vancouver Island anticipating problems based on a growing uneasiness with the Viet Nam war. (Both folks were WW2 vets). When the riots unfolded in Hunters Point they planned their escape. They got out. The desecretion of unrestrained growth continues. The walnut orchards that once surrounded our home were felled and built on 40 years ago.

      I have chosen to live on mid/north Vancouver Island, and have located to a place where any agricultural land cannot be chopped up, and the rest of the surrounding area is working forest, also unable to be ‘developed’. In fact, we own 16 acres which is zoned residential, but we choose to use it as a woodlot, garden site, and field with a pond. Our neighbours like to walk the trails.

      Last weekend a friend of ours visited us from Vancouver. She has an excellent job and is close to retirement, Recently, she was told her older apartment will be torn down for a condo development. Her new forced rent costs will eclipse a recent substantial pay raise. It’s a wash if she remains in the city, so she is planning on pulling the plug and buying a condo about an hour away from us in a small city of 35,000. In fact, the increasing costs of Vancouver have pushed her into treading water; staying only to build up pension. I told her to sit down with a calculator and work the numbers.

      Her solution? Get the hell out as soon as she is forced to move. She is 56 and will take a reduced pension. She will be able to put a substantial down payment on a very nice condo ‘over here’, get a small dog, a small car, and work part-time, maybe 15-20 hours per week until she is old enough to get her Canada Pension. At that time she will cease working. She will be able to do all this including working just 1/2 the time, simply because she has looked for options to her life that was changed by development and circumstance.

      She trades in a rat race with constant noise, sirens, people yelling in the street, traffic, etc…for her own place, 1/2 the work hours, a companion pet, proximity to friends, and beauty all around her. She is ‘getting out’.

      Wolf has made a conscious decision to live where he chooses. It sounds awesome, the way it works for him. Others are stuck, or so it seems, lamenting the costs and lack of options. Well, there are options and the first step is sitting down with a $2.00 calculator and an atlas. Then, Google and G earth some possibilities. If you choose to remain in crane city, then it is by choice.

      • Some Guy says:

        Yes, believe me, I’ve considered those calculations but it is different when you are a long way from being in your 50’s, especially if you have children. But I’m amazed more Vancouverites in their 50’s/60’s don’t pull the plug, take the huge windfall on their property gains and do exactly what you suggest.

    • Petunia says:


      We left south Florida to move to the real south and have no regrets. When we moved to Florida, it was to go where we intended to be in retirement. But things changed and changing with them is the only way to survive now.

      Tell your friend she will be just fine, learn to love what she can where she is, and continue to stay flexible. In the end her biggest achievement will be that she was strong enough not to put up with the BS anymore.

      • Niko says:

        What is considered the “real south”, I may want to move there. I, like you did, thought that I would want to move to Florida one day to retire but like you I now have reservations about that.

        • Petunia says:

          In Florida the saying is that the farther south you go, the farther north you get. South Florida is like the NY/NJ tri-state area with palm trees. It is not the real south. Everybody has a NY accent, including me.

          This does not include Miami which is considered the biggest Spanish speaking city close to the US.

  13. Bobber says:

    In Seattle, you can look at the income statements of the companies to see wages aren’t increasing, except for the portion that is stock related. When base wages are not increasing, but property costs are going up 7-15% per year, it’s only a matter of time before things plateau or crash and there is a reversion to the mean. Also, what happens when the stock portion of the wages quits increasing when companies like Amazon pay 30-50% or more of their compensation in stock?

    I think the stock market and property markets in Seattle are now highly correlated. People think the real estate will only go up, but if there is a stock market crash place like Seattle could see real estate deflate quite rapidly, just like 2007, only more so. Real estate prices will impacted by declining wealth effect as well as declining wages, and possibly layoffs.

    • gardener1 says:

      Great comment.

      We used to drink in Belltown every Friday night and got to know the locals, but now most of those people have disappeared (including us), replaced by imported tech crunchies who think the money train will never stop and stock only goes up.

      You can’t fix young and stupid.

  14. Thor's Hammer says:

    Seems to me that all you “reporters” (except Paulo) are suffering from tunnel vision. A few months ago I had a long conversation with an American who had relocated to Cuenca Ecuador. Since it was a video conversation I got to meet his wife and get a glimpse of the home they live in. For a total monthly outgo of $1,500 they live in a very nice home, have access to high quality medical care, eat far better than they would in the USA because the agriculture is not dominated by frakenfoods and industrial poisons, and have the choice of interacting with a large expat community or their Ecuadorian peers.

    As a retiree over 65, many services are half price, including movie theaters and airline travel.

    Or you could spend 3 hours a day commuting to your 100k job, working overtime with no compensation, and have $100 left over at the end of the month after paying your rent, expenses, taxes and therapist.

    But the best benefit of all is that you can escape from the Empire. Tiny Ecuador is one of the few countries in the world with the intestinal fortitude to stand up to the US and provide sanctuary to Julian Assange when the US wanted to muzzle the release of damming factual reporting and whistle blowing. Wouldn’t it be a pleasure to live in a country where your taxes didn’t go to supporting a policy of Permanent Warfare? Or a medical system that extracts every remaining penny of savings from the commoners?

    • gardener1 says:

      Don’t believe the Ecuador hype, we’ve been there twice scouting for retirement, including January of this year.

      Their healthcare system (IESS) is currently bankrupt, TAME has ceased it’s flight service to Cuenca (8,000 ft. up the Andes), and as of Feb. 1, 2017 they completely renovated their entire visa system to include charging foreigners on a pensioner visa to pay 17.6% of their income for the national healthcare system.

      The lowlands of the coast are utterly third world and hit by earthquakes on a regular basis.

      Ecuador is wildly over rated as a retirement living destination. Most of the country is rundown, poor, and depressing.

      • QQQBall says:


        Thanks for that info. I have been researching expat destinations. My partner and I were surprised that some of these countries have not put on an immigration tax and have heard that Ecuadorians were pissed at the strain on the medical system and higher real estate prices caused by expat retirres. I have lived all over and my partner is well traveled – we are focusing on Europe and perhaps Portugal. I qualify for UK citizenship, so Brexit is an unknown. The 17.6% tax will only ensure low-end retirees.

        One thing in researching possible destinations is that everywhere has problems. I do not like bugs, humidity or corruption… I want to be on the coast and my chillrens are in Europe or headed that way… of course, Europe as a whole has its own issues.

        The expat movement is going to be a tidal wave. Countries like Portugal with golden visa programs are going to be popular and if the medical insurance is reasonable, well-healed expats should help stabilize the economic base. Conversely, we hear that many homes are prices above the 500k threshold due to golden visa buyer demand.

  15. Champinpdx says:

    Been visiting the site for over a year but have never commented. Thanks for all your work, Wolf. I live in Portland and pay close attention to the Northwest markets when I have the time. Here I notice that the rental market is starting to roll over and many of the large flagship/premier rental properties finished during the height of the boom of the last 2 years are now offering between 2 weeks and 2 months free in concessions on even their best units (usually one month to six weeks is the standard). Even the property which set the high water mark for price paid for apartment buildings in Portland is offering significant concessions and has lots of apartments available when I searched today (The building was purchased six months ago by a Thai shell company for over $120 million almost immediately upon completion, likely making the builders $60 million in under 2 years. Also according to a local broker that Thai shell company was funded by American pension fund monies, however there is no way to verify that fact). This is concurrent with a glut of new inventory being brought to market in the next 18 months, as groundbreaking has commenced on multiple large projects in the city center. That being said, I have talked to a prominent CRE broker here in the city and he told me that lots of players are pulling back on both acquisitions and canceling future groundbreaking on proposed projects because they predict that we have topped out in the apartment market and they can’t make the numbers work at this point, which is starting to be reflected here in slight rental price declines and concessions.

    The Portland residential housing market is also starting to even out with much more inventory and aspirational pricing leading to longer average days on the market for anything priced over $400k, which was high not too long ago. High quality flips/properties still sell for higher prices than last year (and we seem to be getting a little spill over from the foreign/Chinese money which has been well documented in Vancouver and Seattle) but most other properties seem to be sitting as local buyers are getting nervous about the prices being asked by sellers.

    Regarding the Seattle apartment market, one interesting factor that I haven’t seen mentioned in these articles is that Seattles median income jumped almost $10,000 (over 14%) in 2015 (which is the last data available), bringing Seattle’s median within 15% of San Francisco’s, and yet the difference in apartment pricing is drastic between the two markets. I understand why this is so (San Francisco has a longer history of boom/bust RE cycles, Silicon valley, foreign money only recently bleeding into Seattle’s market, etc), however looking at median income (~$80,000 Seattle vs. ~$90,000 San Francisco), the difference in rental price is astounding. Per Wolf’s market checkup yesterday, 1 beds in Seattle go for $1,910 vs. $3,450 in SF. 2 beds are $2,500 Seattle vs. $4,500 SF, a difference of 80% with a difference of median income of less than 15% and a tech centered economy in both. While I think the Seattle market will be rolling over (and is in the early stages of doing so) it also feels like there is a general process of equalization due to the insanity/inanity of the SF market. I do see that market crashing again but even 30% declines from today’s prices in SF would lead to $2,500 for 1 bedrooms and $3,150 for 2 beds, still significantly higher than Seattle today.

    As for reports on the ground in Seattle, I know one senior project manager at Amazon and he tells me about the salaries the new hires are making straight out of college (well over $100k), along with the company plans for expansion and while I agree that we have lost the pricing mechanisms for all asset classes, I am curious to see how this plays out in Seattle and, by extension, in Portland. It feels like things have a little further to run in Seattle and we won’t see the real pain until the Nasdaq actually taps out.

    Thanks again, Wolf.

  16. Captain Kurtz says:

    Seattle, more so than San Francisco, is a ‘gold’ rush town. The extraction economy that developed out of whatever ‘gold’ was being violently over-extracted, left this place a BOOM-and-BUST economy, without any decent infrastructure leftover.

    Whether it was gold, (from the Yukon and Alaska rushes) first-growth timber, strawberries, salmon, crab, soft-timber, all these waves of monoculture monomania, over the course of the 20th century, have risen, crested, received massive over-investment, then crashed back to the ground because of the Gold Rush mentality that goes with it – Fantastic success or abject suicidal failure.

    Places like Boeing, Weyerhaeuser and then Microsoft have masked this peculiar generational exercise in trying to make Seattle and the surrounding areas into something more that an irrelevant hinterland, ONE THOUSAND MILES from anywhere.

    In the late 20th century, the power shifted to the Eastside and Seattle languished, as every suburb opened its legs to unbridled development until their meager infrastructure was maxed out – They were farming White Republicans, and the business of farming White People was good.

    Seattle was desperate for these short-term tax injections and dropped ALL pretense of having any development guidelines and went full GOLD RUSH on the development front, infrastructure be damned.

    Now the roosters are coming home. Roads are clogged to the point of gridlock, destroying the innercity bus system. Public schools are over-flowing with the New Gold Miners off-spring ( in the North End). Water mains and the electric grid in a lot of places are still running on their original 19th century installations. Blackouts are more and more common.

    Tensions are beginning to rise between the haves and have nots. The cops shot a pregnant African-American woman and things were unglued for a few days.

    It will be a long HOT summer here in Seattle, because none of these new luxury buildings were equipped with AC!

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