What Is The Future for the Greater Seattle Rental Market in 2025?

What's in store for the housing and rental markets in 2025 and beyond? As an investor, you want to ensure your multi-family property in the Seattle area will be as profitable as possible. That means carefully watching the market and tailoring your approach and strategies to the prevailing economic forces.

At Powell Property Management, we keenly observe trends and shifts and use our 100 years of experience as investment property managers to help investors navigate evolving market conditions. We’re excited to share our insights and what we see on the horizon, helping you make informed decisions in this ever-changing market of South Sound rentals.

Rent prices in and around Seattle historically differ from those in surrounding areas in the state and nation. Renters interested in Seattle will pay more for the convenience and opportunity to live near the action. However, this once-competitive rental market now looks slightly less hot. Rents in South King County are expected to grow by approximately 3-4% annually through 2025. This moderate increase reflects both a stabilizing housing market and the completion of new multi-family developments, which are helping to balance supply and demand.

However, it's not all bad news. Persistently high mortgage rates in 2024 and into 2025 are making it more difficult for potential homeowners to secure financing. As a result, many individuals and families continue to rent, driving demand for multi-family properties; which is great news for investors. 

Rent Increase Caps

Many of our multi-family property investors have noted the recent movement in our area to codify and cap rent increases and have looked to us for guidance as we strategically balance the market conditions with local requirements and profits in mind. Understanding these nuances is vital since failing to comply with notice requirements can lead to legal disputes, penalties, or tenant rent freezes.

First, baseline state regulations apply to all landlords and investors in our area. Washington State law mandates a minimum of 60 days written notice for rent increases. Certain cities, like Burien and Des Moines, have stricter requirements depending on the amount of the rental increase. For example, rent increases exceeding 10% may require a 120-day notice in some areas. More municipalities may soon join this list. Kent and Tukwila have recently considered extending notice periods beyond the state minimum, especially for significant rent hikes.

Up and Coming Multi-Family Property Markets Near Seattle

While Seattle may see only moderate rent increases due to an influx of new apartment construction, South King County is positioned for continued growth. Multi-family property investment groups are beginning to take a more serious look outside the city, and for good reason.  Compared to Seattle, properties in South King County are still relatively affordable, making it easier for investors to achieve a better return on investment. Cities like Burien and Federal Way are seeing a surge in demand as renters seek more affordable alternatives to Seattle.  Normandy Park, Des Moines, Tukwila, and other South Puget Sound cities are experiencing increasingly robust rental markets for young families and remote professionals.

Is 2025 a Good Time to Invest in Multi-Family Properties in Seattle?

Although Seattle has been one of the fastest-growing cities in the country over the last twenty years, growth rates are expected to stabilize in 2025 due to rising living costs and increased housing supply. However, the same is less true of South Puget Sound and Sea-Tac areas. As more professionals and families move to the adjacent cities near Seattle, demand for rental units in multi-family properties will continue to increase in the surrounding areas.

However, there is competition due to the low inventory of investment properties. In other words, as you search for your next investment property in Seattle or the South Puget Sound area, you would benefit from swift decision-making to avoid losing a property to a competitor. Take advantage of the ever-increasing migration to Seattle and the growing popularity of the South Puget Sound area and lock in your investment.

Positioning Your Investment for Success with Powell Property Management

As the rental market in South King County evolves, partnering with a trusted property management firm can make all the difference. Powell Property Management’s in-depth knowledge of local regulations and hands-on approach can help you navigate complex lease requirements, optimize tenant retention, and maximize rental income.

Why Choose Powell Property Management?

• Local Expertise: With over a century of experience in the South Sound region, we understand the unique dynamics of the local market better than anyone.
• Proactive Management: We monitor rental trends and regulatory changes to ensure your properties remain profitable and compliant.
• Tailored Services: From tenant screening to lease renewals and rent increase management, we handle all aspects of property management so you can focus on growing your portfolio.

Expert property managers like Powell Property Management have the experience and skill to provide premium support to you and your tenants on day one. Our insight, expertise, resources, and professionalism will increase your profitability in 2025 and beyond. We’d love to discuss how Powell can elevate your Seattle area investment properties. Let’s connect today.