Rents at large Pierce and South King county apartment complexes were up year-over-year 4.3 percent to 7.8 percent in the first three months of the year, according to Hendricks & Partners, an Arizona apartment real estate firm.

Home prices, on the other hand, have been on the decline for several months – the Pierce County median home price fell 7.6 percent in May to $259,739 compared to the same month in 2007, according to the Northwest Multiple Listing Service. (On a statistical side note: The average rather than median Pierce County home price decline in May was 7.1 percent, but we use median prices -- meaning half sold for more and half for less -- because the median is considered statistically superior for minimizing the swaying of prices by one specific price category.)

Here’s how first-quarter average rents and increases in Pierce and South King counties broke down, along with a couple others around the region. These are for buildings with 40 or more units.

According to The Wall Street Journal, Tacoma is bucking a nationwide trend of swelling apartment inventory. The number of rentals is particularly high in areas, such as Las Vegas and Miami, where the condo market was overbuilt by thousands of units. And where foreclosures are hitting hardest, forcing potential renters into living with family or friends.

In Tacoma, however, vacant units fell by 0.9 percentage point to 5.3 percent -- the biggest drop in the country, according to the WSJ.

A recent report examining Pierce County's rental market by Apartment Insights backs such a drop, saying that the vacancy rate for the fourth quarter was 4.6 percent, down from 5.3 percent in the third quarter. (UP/Fircrest has the lowest vacancy rate in the county at 3.6 percent, according to Apartment Insights.)

The report also says that "the apartment rental market should weather a leveling off period, especially because there is very little new construction to compete with existing properties. Additionally, prospective home buyers will most likely remain in the rental market rather than purchase due to dim prospects for appreciation."

Here's the WSJ story. Look for the Tacoma reference near the bottom:

There's one bright side to the housing crisis: some lower rents.
The regions hardest hit by the housing downturn have seen ailing builders, rising foreclosure rates and a glut of unsold homes, amid other signs of distress. But there are also stories like Laura Evans's.

The 38-year-old elementary-school teacher moved to Stuart, Fla., from Orlando with her husband and baby last fall. Looking for a rental apartment, they were pleasantly surprised: There were plenty of choices at lower-than-expected prices, thanks to the multitude of owners trying to rent units they couldn't sell.

"When we got down here, we shopped and shopped around," says Ms. Evans, who rented a new 2,200-square-foot, three-bedroom townhouse with a pool and a playground for $1,150 per month. The owners allowed the couple to move in with their dog, despite a prohibition against pets.

To be sure, rents have continued to rise steadily in many markets. And the housing downturn means that more people are looking for rentals as well, increasing demand. Many would-be buyers have become renters because they can't get a mortgage in today's tight credit environment, or because they're sitting tight in hopes that prices drop further.

But in the regions hit hardest by the subprime crisis, finding a rental apartment is easier and, in some cases, cheaper than it was before the crunch. Some homeowners forced out by foreclosure are finding rental deals that are at "discounts of 50 percent to 70 percent off what they were paying on their mortgages," says Brenda F. Gerdes, who owns Management Specialists Inc. in Port St. Lucie, Fla.

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Don’t forget about the Tour of Urban Living this weekend – a self-guided tour of downtown Tacoma condos and apartments. You’ll find 13 condominium buildings split primarily between the downtown core near City Hall and a group around South 23rd Street. (Though you’ll also find the Marcato between the two clusters and The Esplanade along the water.) Some have full-size models to stroll through and others have a sales center.

There are also three apartment projects. Hours are 10 a.m. to 5 p.m. Saturday and Sunday.

Go here for a map of what’s on the tour.

UPDATE
Some of the condo projects on last year's tour won't be reappearing, because they sold enough to not need another round or have hit delays, according to Roxanne Murphy, community relations specialist at the City of Tacoma.

Those with enough units sold:
201 Broadway, 201 Broadway
Bridge Condominiums, 744 Market St.
Classic Urban Townhomes, 2307 and 2309 S. I St.
Dorothy Condominiums, 301 N. Tacoma Ave.
Galleria, 2520 S. Jefferson Ave.
Triangle Townhomes, 408 6th St.
The Vintage Y, 714 Market St.

Those from last year's tour that have since been delayed, Murphy said:
The Ansonia, 219 N. Tacoma Ave.
Broadview Condos
Chelsea Heights, 603 S. J St.
Jay Heights, 613 St. Helens Ave.

And these are new this year:
505 Broadway, 505 Broadway
Lexington Square, 2303 S. G St.
Metro City Homes, 2131 S. Yakima Ave.
Walker Condominiums, 405 6th Ave.

Pierce County apartment vacancy rates have fallen to their lowest level since 2001, according to the Sept. survey released today by Seattle research firm Dupre & Scott. Local vacancies are at 3.6 percent compared to a Pierce County high three years ago of 8.2 percent.

Rents continue to reside well below the Puget Sound average, the report said. The county’s average rent is $771, compared to $930 for the Puget Sound region.

Numerous sources have told me in recent weeks that they expect apartment vacancies to dip and rents to rise as first-time buyers struggle to get financing with today’s tighter lending guidelines. Vacancies are following the predictions – we’ll have to see on the rents. I’m expecting a more detailed report on Tacoma in the next few days and will update when it arrives.

UPDATE
As promised, here are the stats for downtown Tacoma: Vacancies were at 5.1 percent in September, lower only one other time since 2003 when the vacancy rate was 3.3 percent in March 2006. Average rent was $860, up from $813 for September of last year.

Guardian Management LLC, a Portland company, has launched a new non-smoking policy for 8,000 of its apartments – more than half of the company’s holdings. The policy prohibits smoking inside the units and common areas and within 25 feet of any building on the property, according to a news release.

Guardian owns a building in Olympia and another in Federal Way so I’m checking to find out if the policy will be in effect there.

I know such policies are becoming more and more common -- anybody remember the state’s voter-approved ban on smoking in bars and restaurants getting under way in 2005? Hotels I recently stayed in have phased out smoking rooms. But in your own apartment or on its balcony? Any thoughts?

There's an East Coast software company called iiProperty.com that has developed an online rental tracking program and it looks very promising. In fact, for those of you who own multiple rental properties this sucker could be a godsend.

For about 13 bucks a month you can plug in up to 4 units into the program and it automates all sorts of stuff you probably hate to do manually. Like:
• Quick Post to Craigslist for rental ads
• Track Rents due and received
• Automate Invoices
• Tenant Notices via Email or Snail Mail
And for an additional monthly fee you can track up to 55 units, saving you endless headaches.

My favorite part about it though is the free Rent-o-meter.

This thing compares what you're charging for rent and what your neighbors are asking. I checked it out using a duplex address of a property I own and it kicked out 18 neighboring duplexes with prices and addresses all mapped out on Google maps.

It appears to be very accurate too. I always wondered how competitive my rates were, and now I know! I'm exactly where I expected to be positioned, rent-wise.

There's another fun link on the Rent-o-meter, it's a Top Ten List of the highest rental Rates in the US by zip or city. Not hard to guess the names that pop up: New York City at $5,200 per mo, Malibu at $4,615 per mo, and Beverly Hills seems to be a steal at only $3,550 per month.

Hey, maybe instead of spreading bark in out in front of the duplex next Spring, I'll dump some sand out there with a plastic pool and some fake sharks in it. That way I can call it beachfront property and raise the rent on my tenants. :)

Submitted by Steve Hurley

www.Tacondo.com