INSIDE REAL ESTATE: Anchorage, Kodiak only areas to see vacancies up, rents down
Anchorage and Kodiak were the only two areas where vacancies rose in 2018 and rents dropped, according to the latest survey by Alaska Economic Trends in conjunction with the Alaska Housing Finance Corp.
Anchorage’s vacancy factor rose to 6.2 percent, up slightly more than 1 percent due to negative migration. Meanwhile, the Matanuska-Susitna Borough had a net migration of 1,233. Its vacancy factor was down to 7.3 percent from 7.6 percent in 2017. However, it was still higher than Anchorage’s.
Single-family homes in Anchorage have an average monthly rental rate of $2,149. Higher rental income can be obtained for four-bedroom homes that have a double- or triple-car garage. Renters with pets can expect to pay an additional $100 to $150 per month plus a pet deposit according to leasing agents. Smokers also pay a premium.
The most popular rental areas and the most expensive in Anchorage are in the Bootlegger’s Cove area and southeast Anchorage. Rental rates tend to be lower in East Anchorage, which has an abundance of zero lot lines and older two-bedroom, multi-family units.
Newer properties have a premium and so do units with an interior washer/dryer. In the Fairbanks North Star Borough, a three-bedroom single family home rents for $100 more than in Anchorage while the lowest rental rate is in the Wrangell-Petersburg borough where single-family homes rent only for $1,034.
The rental rates above include all utility costs, according to the survey. However, more desirable rentals in age and location often charge the renter for at least gas and electric, assuming separate meters are available.
In particular, single-family homes and luxury duplexes often have tenants paying basic utilities while providing water and sewer. In Anchorage and the Mat-Su, more than 90 percent of all rentals use natural gas for heat and hot water.
However, in almost all areas of the state, cooking is powered by electricity, as are washer/dryer hook-ups.
The small increase in vacancy factors and modest decline in rental income is reflective of the stability in the housing market which continues to adjust to historic lows for new construction permits, whether for sale or rent.
As of August 2018, Anchorage had only 10 applications for multi-family permits, totaling 129 units, compared to 21 applications in 2017 for 153 units, which demonstrates that multi-family projects are increasing in size and scope of the number of units per projects.
Duplexes, considered by some the new affordable single-family home when each side is sold, has had a decrease in number of units built so far in Anchorage.
The latest Municipality of Anchorage published statistics for August show a decline in year-to-date permits from 58 compared to 76 in in 2017. The MOA does not differentiate between rentals and for sale units for multi-family and duplex permits.