Bend continues to be a high-performing market. We are seeing a glaring issue with 482 units scheduled to be completed in 2025, which amounts to 8.2% of the overall supply in the market. As you can see in the above graph from costar, that will create a significant increase in vacancy as the supply outweighs the markets’ ability to absorb those units. Granted, many of these units are on the higher end of the spectrum. However, there will be a trickle-down effect on middle to lower-income units. Many of these higher-end buildings are offering specials to fill units, like a free month of rent, more aggressive rental pricing, and other specials.

In the last 12 months, you have seen asking rents come down across the board by 1.3%, and into 2025, rents will mostly not move much. However, some buildings in leasing mode will feel more of the effect of the additional supply and downward pressure on rents. As you can see from the above forecast, there will be healthy regular rent per unit growth after 2025 in the long term. Additionally, the population in the next five years is projected to be robust, averaging over a 2% increase yearly, which will help absorb these units.

How to combat this

It’s having a property manager who is aggressive and has a sense of urgency with leasing. Pricing units in line with the market to get them to move quickly. Ensuring the best pictures/descriptions are up and advertised everywhere. Additionally, efficiently managing all the prospective tenant messages, ensuring all leads are followed up on almost immediately, and effectively vetting leads to get to the most serious potential tenants. When showings happen, they are being sold and closed on. This is where RidgeLine Property Management shines, using technology to effectively manage all this while still having the human touch to get prospective tenants sold quickly.

Since there may be slightly higher vacancies at properties and downward pressure on rents, keeping expenses at bay by sticking to a budget will be much more critical. Here at RidgeLine, we review monthly budgets, line by line, to see where we need to improve.

Additionally, getting that extra bid for work that must be done to reduce costs will be imperative. Being proactive about work that needs to be done before it becomes more costly will be key. The bottom line is keeping a tight leash on things, so the bottom line isn’t changing because the top line might.

Right now, is the time to ensure everything runs as efficiently as possible. Make sure your manager is contemplating this increase in supply and what that might mean for your property. This is the time when good proactive managers shine, going the extra mile to do the exemplary job we here at Ridgeline do.