Salt Lake City Multifamily Market Stable

SALT LAKE CITY, UT-Apartment rents and vacancy rates are remaining fairly stable in this city, despite a stagnating economy. That is the conclusion of a third quarter report by Hendricks & Partners, which specializes in selling multifamily rental properties.

During the one-year period that ended this September, local employment growth grew by only 0.7%, down from 2.1% a year ago. Gateway, Delta, Iomega, Starwood Hotels, Novell and 3 Com are among the companies cutting jobs, the Rocky Mountain Region report notes.

In addition, major construction jobs have been completed, cutting nearly 3,000 jobs.

“Slower job growth is contributing to a sluggish real estate market,” Hendricks & Partners says.

The multifamily rental market registered negative absorption of 1,992 units during the third quarter, compared with a positive absorption of 807 units a year ago. The overall apartment vacancy rate was 4.2%, up slightly from the 3.9% vacancy rate a year earlier. However, the vacancy rate was only 2.8% in the second quarter of this year, in part because of earlier, strong absorption.

Some tenants are being forced out of their apartments by property owners who are anticipating strong demand for the Winter Olympic Games in February.

“Several local apartment communities are already evicting tenants in anticipation of providing housing during next year’s Olympic Games,” the report notes. “While this trend may cause vacancy rates to trends up, then down over the next few months, the effects should be merely temporary.”