— Tim McKay of Cushman & Wakefield —
Seattle’s multifamily market has faced challenges over the past few years. Rent growth has been flat as a significant number of new units were delivered in 2023 and 2024. This new supply also led to concessions and even rent declines in some markets. Submarket supply issues and the new statewide rent control legislation have also contributed to market headwinds.
However, 2025 has brought signs of recovery, and there’s optimism about the market’s trajectory over the next few years. It feels like Seattle has bounced off the bottom and is starting to climb back up, similar to the recovery seen in 2011 after the Global Financial Crisis.
Rebounding Demand
The multifamily market has seen a recent uptick in demand, which can be attributed to several factors. A key driver has been the return-to-office mandates from major employers like Amazon and Starbucks. Seattle’s population is also expected to grow again, and the supply of new units hitting the market has drastically declined. These factors are contributing to renewed growth after a four- to five-year stagnation.
Stabilizing Rental Rates
Owners are starting to put properties under contract again. Land prices haven’t returned to previous levels, but they are improving. Rent growth is beginning to emerge, with effective rents rising for the second-straight quarter, up 1.8 percent year over year. The number of units under construction in the second quarter fell 95.8 percent year over year to just 735 — the lowest level in a decade. Population growth and limited new deliveries will benefit absorption, which is expected to rise in the next 12 months.
Investor Activity is Slowly Returning
Seattle is showing strength as a whole, but some submarkets are still facing challenges. The Eastside markets, including Bellevue, Kirkland and Redmond (home to Microsoft), have remained strong. Developers and investors continue to view these areas favorably, with equity, capital and debt showing confidence in their long-term potential.
Some Submarkets Adjust to New Supply
The downtown, Belltown, South Lake Union and University Village areas have felt the effects of a high volume of new units coming online. Just east of the University of Washington, University Village is an affluent area but has seen a surge in supply that has temporarily impacted performance. Outside of these areas, the rest of the city has stabilized and is trending positively.
Rent Control May Favor New Development
Washington passed statewide rent control earlier this year. While new construction is exempt for 12 years, the policy is expected to have a significant impact on older apartment properties with below-market rents. Operators maintaining market or above-market rents will likely be better positioned to perform. However, the policy may deter some developers from considering Seattle, even though rent control could benefit new developments.
Overall, Seattle’s multifamily market is regaining momentum, with many submarkets seeing rent growth and signs of stabilization after several challenging years.
— Tim McKay, Managing Director of Cushman & Wakefield. This article was originally published in the August 2025 issue of Western Real Estate Business