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Supply Surge Will be Short-Lived in Portland,
Sowing Seeds for Apartment Sector Recovery
Multifamily transition concludes in 2024. As of March, the metro had under 3,900 apartments slated for delivery beyond this year. Fully enacted in early 2024, Portland's Inclusionary Housing policy — which requires that builders limit rents for a portion of new units — paired with Oregon's state-wide, seven percent rent cap, are reducing the number of apartment projects that pencil. While near-record deliveries will push vacancy up to a two-decade peak in 2024, these regulatory forces suppressing new supply should enable property metrics to recover in the coming years. Apartment demand is also on the rise, following 2022's overall net relinquishment. In 2023, Portland noted population growth for the first time in almost three years, helping net absorption return to positive territory.