Portland's Rent Spike Spreads East, Pressuring Low-Income Residents

New figures show that soaring housing costs are disproportionately hurting those least able to pay more.

New figures show that soaring housing costs are disproportionately hurting those least able to pay more.

All year, the city's residents have seen their monthly rent bills rise, even as they have watched the construction of new apartment buildings they can't afford.

But new numbers from the Portland Housing Bureau show the spike in rental rates extends beyond the traditionally higher-rent neighborhoods, and reaches into lower-cost neighborhoods at the edges of the city.

The city's analysis shows rents are rising more steeply in many East Portland neighborhoods than in the central city and its new, gleaming apartment towers.

That matters because housing is by far the average person's largest monthly expense, and housing costs in Portland are increasing far faster than the prices of other goods—which have remained essentially flat for the past year—and, more importantly, far faster than incomes. (Oregon wages increased by about 3 percent last year.)

The new figures, part of a sweeping housing affordability study released by the city Sept. 25, show Portland rents have climbed 8.4 percent across the city since last September—meaning the average monthly rent rose by about $100 in the past year.

That increase deepens fears among housing advocates that low-income families won't just be priced out of central Portland neighborhoods such as Vernon and Sunnyside—but pushed out of the city altogether.

"What's even more heart-wrenching is that these are many of the people who were displaced to here," says Lore Wintergreen, who works for the city as the East Portland Action Plan advocate. "Are we now going to move those families completely out of Portland, is the question. Because we haven't had the policies or the dollars in place to prevent it."

To be sure, Portland's central neighborhoods continue to have much higher rents than East Portland: A two-bedroom apartment costs an average of $1,220 along inner Southeast Hawthorne Boulevard and Division Street, and just $884 in the neighborhoods near where Division Street meets Southeast 122nd Avenue.

But the average rent for a two-bedroom unit along outer Division increased at a much steeper rate—10.1 percent, or $81 a month—than the 4.4 percent, $51-a-month increase along inner Division and Hawthorne. And as the map above shows, some of the biggest rent hikes in the city—16.9 percent in Parkrose, 14 percent in Lents, and 14.8 percent in Montavilla—are occurring in Portland neighborhoods along I-205.

Those hikes are part of a 34 percent increase citywide in the cost of a two-bedroom apartment since 2010, according to the Housing Bureau. The "State of Housing" report demonstrates the results of a wave of new residents arriving in a city that until recently had the nation's lowest vacancy rate and hasn't built enough apartments to keep pace with demand.

"To use a car analogy, there's a lot more people who are looking for Chevrolets than are looking for BMWs," says Nick Sauvie, executive director of neighborhood-revitalization nonprofit Rose Community Development. "And a lot of what's been built in Portland lately has been high-end rental housing. If there's less supply at the lower end of the housing market, those prices are going to go up."

But the neighborhood numbers also present a serious political math problem for Mayor Charlie Hales. In the 2012 election, Hales struggled to gain traction in neighborhoods east of I-205. Those areas provided his slimmest margin of victory even after the collapse of his chief opponent, former state Rep. Jefferson Smith (D-Portland).

Now many of those neighborhoods are seeing the cost of housing rise at a faster pace than the city as a whole.

Hales' chief opponent in 2016, State Treasurer Ted Wheeler, has been hammering the mayor for inattention to rising housing costs and homelessness. Last week, Hales called for the declaration of a citywide housing emergency, an announcement that smacked of panic because it caught city, county and state officials by surprise.

"This office has been grappling with both housing affordability and homelessness since I got a here a year and a half ago," says Hales development policy director Jillian Detweiler. "And while we've made some progress, it's become clear we've got to notch it up."

This story appears in print with the headline, "Take a Rent Hike."

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