Preserving Housing Choice and Opportunity: A Study of Apartment Building Sales and Rents

NOAH sales show precariousness of this rental housing at a regional scale. Active transactions of multifamily rental properties have been disproportionately NOAH. There have been over two thousand transactions of NOAH buildings in the Portland metro area from 2006 to 2017 — over 68,000 units of housing. These sales are accelerating, with over 20 percent occurring in just the last 18 months. Sales prices for multifamily rental properties have increased substantially, making preservation of affordable rents more challenging. Regionally, the average sale price increased by 78 percent between 2010 and 2017; during this period there was a 43 percent increase in the average asking rent. Multifamily housing properties in racially diverse and low-income neighborhoods have been a target for sales activities. Nearly half of the rental units sold were in low-income tracts; and nearly 60 percent were in racially diverse tracts. Almost all of these sales were to two-three star NOAH type properties. NOAH in the SW Corridor Approximately 11,400 units of naturally occurring affordable housing (NOAH) exist along the Southwest Corridor — 327 properties home to renters with affordable rent. NOAH accounts for 93 percent of existing apartment buildings along the corridor. At the region wide scale, these buildings represents over 9 percent of the market affordable rental units in the metro. During the last five years, the corridor shows a split of very low and very high income renter households. After 2010, 81percent of newly built multifamily housing units in the corridor were luxury apartments. Although 70 percent of units existing in the corridor are currently affordable to families having low- to moderate-income, the recent influx of high income renters and housing market investment made in the corridor suggests that upscaling of NOAH will become more attractive with the coming public investment in high speed transit. Recent apartment sales in SW corridor are increasing, rising in price per unit, and are NOAH type housing. The average sale price along the corridor skyrocketed significantly, with a 274 percent increase. y When upscaling of NOAH happens along the corridor, the most vulnerable households will be low-income renters of color having large size family. Two-thirds of corridor NOAH sales are in low-income census tracts; nearly 40 percent are in racially diverse areas. If we consider NOAH as most susceptible to upscaling, there is the potential for over 11,000 rental units to be re-graded in the corridor. Over four thousand of these units are located in large buildings of over 100 units, with the potential to displace large numbers of renters with one building sale