Washington Multifamily Marketwatch News Roundup May 27, 2025
Washington’s real estate market is facing pivotal changes: statewide rent caps, a governor’s veto has halted a comprehensive study of rental cost drivers, and potential changes to the SALT deduction.
1. Proposed Changes to State and Local Tax (SALT) Deduction Cap: Could it increase buyer demand, boosting values and transactions?
Congress is considering raising the SALT deduction cap, a move especially relevant for high-tax states like Oregon and Washington. The proposal would lift the cap from $10,000 to $40,000 for individuals earning up to $500,000, with annual increases. The SALT deduction may improve disposable income and home-buying power, potentially increasing demand for both residential and commercial property in the region. However, the bill’s outcome is uncertain in the Senate due to fiscal concerns (https://www.washingtonpost.com/business/2025/05/23/salt-deduction-tax-bill/}).
2. Washington’s New Rent Cap Law – Chilling Effect on Multifamily Investment?
Washington has capped annual rent increases at 7% plus inflation (up to 10%) for most rentals and 5% for mobile home parks. Newer buildings and affordable housing are exempt. The law aims to provide stability to renters, but raises concerns among landlords and developers about reduced profitability and deterring new housing investment. Experts predict minimal effect on overall rent trends, but landlord caution may affect future supply (https://www.seattletimes.com/business/real-estate/wa-renters-landlords-prepare-for-new-cap-on-rent-hikes/}).
3. Governor Ferguson Vetoes Housing Cost Study – Missed Opportunity for Data-Driven Policy and Market Clarity
Governor Bob Ferguson vetoed a bill that would have studied housing cost drivers in Washington, stating that resources should be used to implement solutions based on previous studies. Critics argue this missed chance for additional insight, broader stakeholder participation, and further data to inform effective policy (https://www.everettpost.com/state-news/ferguson-vetoes-bill-to-study-cost-drivers-for-homeownership-rental-housing-in-wa}).
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