The market is working, according to City Observatory's take on data finding declining rents in the city of Portland.

Joe Cortright writes:
According to Apartment List.com, rents for one bedroom apartments in Portland have declined 3 percent in the past year. It’s a solid vindication of the standard predictions of economic theory: adding more supply (building more apartments) helps drive down prices.
Cortright argues that a rush for building permits filed before the city approved a new inclusionary zoning ordinance a few years produced a glut of new construction and then new units.
Landlords are notoriously loathe to cut advertised rents, but in addition to tolerating longer vacancy periods, there’s evidence that there’s considerable discounting going on in the local marketplace, with landlords offering one- or two-months free rent, waiving fees and deposits and even offering pre-loaded debit cards.
While construction continues at a rapid pace, rents could continue to drop. Cortright's concerns about the inclusionary zoning ordinance still apply, but the ordinance's effect will be felt in the market in a few years, after the current glut of pre-ordinance units are built and rented. Permits for new apartments, have "slowed to a trickle," since the ordinance took effect, according to Cortright.
FULL STORY: Portland rents are going down

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