MARKET SNAPSHOT
Seattle’s multifamily construction activity slowed significantly in 2024, with 15,400 units actively under construction as of the end of the fourth quarter, the lowest level in a decade and a sharp decline from the peak of nearly 29,000 units about a year ago. This drop signals a forthcoming slowdown in new deliveries over the next two years.
The decline follows a period of record-high completions, with 34,000 units delivered over the past three years. While deliveries remain elevated, fewer projects are breaking ground, with new starts down 60% year-over-year and 80% below the market’s peak. Although Seattle remains a leading market for multifamily construction, it has slipped in the national rankings as development activity shifts toward Southern metros such as Austin, Dallas, and Phoenix.
In 2024, 95% of all new starts in the Puget Sound region were concentrated in Seattle, Redmond, Kirkland, Shoreline, and Bellevue, with nearly half occurring in Seattle proper. However, across most of the region, construction has slowed as projects reach completion without new developments taking their place.
With fewer projects in the pipeline, 2025 deliveries are expected to decline sharply compared to recent years. This reduction should help ease competition among lease-up properties, many of which have relied on elevated concession offerings to attract renters.
Seattle’s multifamily market remained resilient in 2024, with average occupancy inching up to 94.4% in Q4, a 10-basis-point annual improvement. Strong demand in Bellevue, Gig Harbor, and Auburn contributed to this growth, while Downtown Seattle (92.9%) and Kent (92.8%) lagged behind due to higher vacancies and a slower pace of absorption.
Looking ahead to 2025, average occupancy is expected to remain stable, ranging between 94.3% and 94.5%, as the market absorbs a reduced volume of new deliveries. However, larger completions in Downtown Seattle (1,519 units) and Redmond (865 units) could exert downward pressure on occupancy in these areas. Despite this, most submarkets are expected to maintain stable occupancy rates as supply and demand dynamics continue to normalize.
Seattle’s apartment market demonstrated resilience in 2024, with Q4 effective rents rising to $2,019, reflecting a 1.7% year-over-year increase and remaining above the national benchmark. Looking ahead, supply levels are expected to decline further in 2025, helping to balance supply and demand and fostering more stable rent growth across the region. By year-end, average rents are projected to rise by 2.7%, reaching $2,073.
Submarkets with limited new deliveries, such as Federal Way and Issaquah, are poised for robust annual rent growth exceeding 3.5%, driven by constrained supply and steady apartment demand. Seattle also remains relatively competitive in terms of affordability compared to other major metros. The forecasted 2025 average rent of $2,073 positions Seattle favorably against markets like San Francisco and Los Angeles, where average rents exceed $2,500.
12-month period ending November 2024
Seattle’s multifamily market demonstrated resilience in 2024, supported by a strong economic foundation, sustained demand, and a contracting development pipeline. Q4 effective rents reached $2,019, marking a 1.7% annual increase, with average stabilized occupancy improving to 94.4%. While new supply has slowed significantly—with just 15,400 units under construction, the lowest level in a decade—absorption has remained steady, particularly in submarkets like Bellevue, Gig Harbor, and Auburn, where occupancy exceeded 95%. Looking ahead, rents are forecast to grow by 2.7% by the final quarter of 2025, reaching $2,073, while occupancy is expected to hold steady between 94.3% and 94.5%. With fewer new projects breaking ground and deliveries set to decline, supply and demand fundamentals are expected to stabilize, easing competitive pressures on lease-up properties and supporting long-term rent growth.
Seattle’s resilience and forward momentum are underpinned by a diversified economic base, a strong job market, and a commitment to sustainability and innovation, making it an attractive destination for long-term investment. The metro’s unemployment rate averaged 3.8% in 2024, well below the national average of 4.4%, reflecting the region’s stable economic climate. In 2025, Seattle is projected to add 19,200 new jobs, a 0.9% annual increase, with Professional and Business Services leading growth at 1.5% annually through 2029. While Downtown Seattle and Redmond will see the largest influx of new units, most submarkets will maintain stable fundamentals, reinforcing Seattle’s position as one of the nation’s most competitive yet relatively affordable multifamily markets compared to pricier coastal metros like San Francisco and Los Angeles.
