The apartment market in the Washington area is tighter than it has been in recent history, and on a par with the situation during World War II, when the District was flooded with government workers, according to a new survey of vacancy rates.
Out of 100,000 apartments in large complexes surveyed in September, the national real estate research firm Delta Associates turned up 435 vacant apartments in suburban Maryland, 293 in Northern Virginia and only 10 in the District.
"I never expected that you'd find a situation where 40 to 50 people are competing for an apartment," said Kathryn Provonsil, a music teacher at the Sheridan School in Northwest Washington, who finally located an apartment, on Capitol Hill, Wednesday night. She had been hunting for any kind of apartment since early August.
It's a situation, said Provonsil, where individual landlords "say `the apartment is $1,400 a month, but if you'd like to pay more you can' and where people are offering to pay six months in advance." Provonsil, who moved here after a two-year job in Ecuador, said the experience was "a shock."
"Landlords really don't have to do anything" to get renters, she added. "I've gone to see places that are filthy. They don't even clean them."
"It's very, very frustrating," said Magdalena Gruszka, a 20-year-old Army Reserve administrative specialist who has been looking with her parents since July. The three haven't seen anything "acceptable" in Northern Virginia near their price range of $900 to $1,100 a month for a two-bedroom. Gruszka, however, believes an opening may come up in December.
"This is the worst it's been in the five years I've worked here," said Al Wallace, a marketing associate for Apartment Search, a nationwide apartment locator with offices in Alexandria, Bethesda and Falls Church.
Wallace said that summers are always tight because of intern and fellowship programs, and that vacancies usually open by Sept. 1. But the situation "started changing as of September 1998," he said. Last year and this, buildings have still been nearly full after summer ends. They no longer offer September or October rent-reduction specials.
"One property downtown that has never had more than 90 percent occupancy now has a six-page waiting list," he said.
The "turnaround time" from when an apartment comes up and is rented "is a blink," said Dee Holmes, another Apartment Search associate. "We have had people crying here in the office" in frustration.
The Delta survey found that about 12 high-rise units of the 5,800 built in the past 10 years in Rosslyn were vacant as of September. There were none among 3,000 garden units built in the same era in Centreville. And there were absolutely no apartments -- zero, zip, nada -- that could be rented immediately among the 2,009 units in the large, older high-rises in upper Northwest Washington.
The Delta survey, which covers complexes containing 150 to 200 units, showed the area-wide third-quarter vacancy rate as 0.7 percent, compared with 1.2 percent for the second quarter and 1.8 percent a year ago.
The area's 0.7 percent vacancy rate compares with a national average of 6.5 percent. Delta said Washington, Baltimore and Philadelphia have lower vacancy rates than any other major metropolitan area in the country. Another research firm, Marcus & Millichap in San Francisco, said Washington's market is the tightest.
Mark Teather of Delta's Alexandria office said Washington had "the tightest vacancy rate since World War II," when the rate was about zero. The firm, which tracks real estate trends for subscriber developers, has followed the metro area since the '80s and the District since 1993.
Marcus & Millichap includes apartment complexes of 50 to 100 units in its analyses. The firm's data, according to Hessam Nadji, national director of research, found the metro vacancy rate to be 3 percent for the first quarter of 1999. It has since dropped to around 2.7 percent. That is the tightest, according to the firm's records, in six years.
"Every quarter I think the rate can't get even tighter, and it is," said Teather of Delta Associates. "Technically, the vacancy rate is zero" for much of the District.
A zero rate means "you're renting your apartments on a `notice' basis," meaning as soon as someone moves out, the unit is filled, he said. "It's great for landowners but not so great for consumers."
The situation is so tight, said Delta chief executive Greg Leisch, that for the first time in 29 years the firm is tracking waiting lists as an indicator of demand.
As might be expected, the crunch has led to a jump in rents. The survey finds rents up about 9.5 percent in the District since September 1998 -- about twice the hike in the city's suburbs. The District's increase in large part is due to new construction, which is exempt from rent control.
The most stunning increase, said Leisch, is a 12.5 percent rent surge in Class A buildings -- those built in 1988 or later, with modern amenities -- in Arlington's Rosslyn-Ballston corridor.
Of 2 million households in the metro area, about 600,000 are renters. About 400,000 of those rent in complexes of 150 to 200 apartments. The rest are in small buildings, houses, town houses and condos. Delta surveys about 107,000 units in large complexes.
Sabrina Jackson, 23, a Starbucks employee who lives in Arlington, told Apartment Search she has been looking for months for an apartment in Suitland or Oxon Hill. "It's so hard," she said Wednesday. "I can't seem to find a nice, decent affordable apartment for my income." Jackson earns $13,000 a year.
Jackson's situation is tougher than most because of her income level, but Holmes said her frustration is mirrored by young professionals, college students, interns and others earning much more.
"Ninety percent, if not more, of the people we see want to live in Northwest. We hear it constantly," said Holmes of Apartment Search. "Unfortunately, there hasn't been any new construction completed yet there."
Betsy Neal of Roommates Preferred in Upper Georgetown said higher salaries being paid to those at the bottom of the ladder are partly to blame. "Kids are starting at $50,000 to $60,000 a year in these high-tech places. . . . It used to be that they weren't in the apartment market until they were 30."
While renters are ruing their plight, it's great news for the District, a tribute to its comeback, said Teather.
It's definitely a far cry from 1994, when the District's vacancy rate was on the order of 10 percent or 11 percent.
Teather cited several reasons for the dearth of rentals: The boom in downtown office construction has brought many jobs, there's "a new political scene" promising a turnaround, and people who drew disenchanted with the city and moved away are now returning. He also cited a national demographic trend in which "young people want to be close to the action."
Little in the Pipeline
Apartment construction planned for the District lags behind the rest of the area:
Units being built in the next three years
SOURCE: Delta Associates
Vacancy rates at large apartment buildings in the area have declined markedly over the past year.
Sept. '98 1.8
Sept. '99 0.7
Sept. '98 1.1
Sept. '99 0.3
Sept. '98 1.7
Sept. '99 1.4
Sept. '98 1.1
Sept. '99 0.5
SOURCE: Delta Associates