Some area landlords are pulling their For Rent signs out of mothballs, while others are cutting rents or offering a month's lodging free to combat the highest apartment-vacancy rates that the Washington area has experienced in at least 10 years.
Apartments are going begging, D.C. area property managers say, primarily because of the competition from single-family homes now available for rent in large numbers because high mortgage-interest rates have stalled their sales.
"Instead of paying $300 a month for a one-bedroom apartment, you can share a $100,000 house and pay $250," said John T. O'Neill, executive director of the Apartment and Office Building Association (AOBA), a trade organization for landlords and commercial property managers. "It is a safer environment, more stable, more space. It's a lot more value for the buck."
The glut of unsold homes has combined with other effects of hard times -- fewer people moving into the area, friends doubling up rather than living alone, young marrieds and singles staying with their families rather than living on their own -- to double apartment-vacancy rates in the last year.
"There's plenty of supply and demand is down," said Joseph Murray, chief of property management for Shannon and Luchs. "We still have people on the move but not to the degree we used to, and that's a dramatic change for Washington because it has always been growth here in Washington."
"All kinds of concessions are being made to get people to come in," said Irving Kreigsfeld, president of Management Partnerships Inc., a local management company.
Real estate experts said the increase in empty units had affected all apartment buildings except those for the very rich and the poor. Vacancy rates in apartments renting for more than $700 a month, which traditionally run around 3 percent, according to Montgomery County Board of Realtors official Aaron Dodek, have remained unchanged. At the same time, waiting lists continue to grow for federally subsidized apartments and public housing. The D.C. housing department estimates that 9,000 people are waiting for vacancies among the 12,000 units of public housing in the city.
After receiving a number of complaints from apartment owners and managers about growing vacancy rates, AOBA this year resumed an annual occupancy survey that had been suspended in 1972 after thousands of garden apartments built mainly in the suburbs in the mid-1960s were occupied. At that time vacancy rates leveled out at about 1 percent in D.C. and Virginia and 2 percent in Maryland, and periodic surveys by the Metropolitan Washington Council of Governments, most recently in 1981, confirmed that the rates were holding at that level.
Last March, however, AOBA's survey of 60,000 privately owned apartments -- about 40 percent of the area's total of 165,000 -- showed that in the District vacancy rates had risen to 3.5 percent and in Northern Virginia to 2.5 percent, a jump of more than 100 percent. In Maryland, vacancies had ballooned to 6 percent, a 250 percent increase, O'Neill said.
A second AOBA survey on Oct. 1 found the Virginia vacancy rate at 2 percent, the District rate at 3 percent, and the Maryland rate at 4 percent. Other real estate experts, however, said they believe the area rate is still closer to 6 percent.
O'Neill said AOBA will continue to take an occupancy survey quarterly, adding: "We are now nervous."
Apartment owners and managers, meanwhile, are trying a variety of tactics to fill their empty units.
Buckingham Village, picturing Santa Claus in its newspaper ads, is offering prospective tenants a month's free rent if they sign a year's lease. This 1,900-unit project just off Rte. 50 in Arlington has dropped plans to convert to a cooperative and instead has reverted to rental apartments, according to sales agent Barbara Davis.
Blue Ridge Manor in Silver Spring is also offering free rent, but only for a small number of two-bedroom apartments, all but one of which had been taken as of Thursday. Tenants were required to live in the apartment a year before they could receive this benefit.
The Oakwood apartments in Alexandria have reduced the rents on apartments in their four older buildings from $600 to $525 for two-bedroom units. In Forestville, Md., Oakcrest Towers has also reduced rents up to $30 on some apartments in its 1,540-unit complex.
The Manor in Aspen Hill and Thomas Choice in Gaithersburg are both offering a $300 credit to reduce the first month's rent to slightly more than $100.
Other apartment buildings, including the Latrobe in the District and Kaywood in Mount Rainier, have temporarily dropped the requirement that the security deposit be an amount equal to the first month's rent ($300 to $400) and instead are asking for only a $200 deposit.
Some projects are simply hanging out For Rent signs. "I'm seeing signs in front of buildings where I have never seen signs before," said G.V. (Mike) Brenneman, president of the Washington Board of Realtors. "I have not seen for rent or vacancy signs on MacArthur Boulevard for nine years."
Peter Van Oot, 27, a Senate aide, said he and two friends decided to give up apartment living and share a house in Chevy Chase because "of the quality of life."
"With the money I have I could only afford a studio, " said Van Oot, "but going into a house for the same cost I have a full living room, dining room, laundry room and full porch. What would it cost me to get all that in an apartment?" he said. He and his friends pay a total of $695 a month rent plus utilities for their three-bedroom home.
Todd Peckarsky, a management analyst with the Department of Education, said he prefers the three-bedroom town house he now shares to his former apartment because "it seems more like a home."
O'Neill said he had noticed the trend in his own neighborhood in Mount Vernon. Two of the dozen houses on his cul-de-sac are now rented. "I have not seen that in the 12 years that we have lived here," he said.