Kenai Peninsula average rents second lowest in Alaska

It’s the start of a new month — have you paid your rent yet?

For Kenai Peninsula Borough renters studied in an annual state report on the rental housing market, the area’s average rent is the second lowest in the state — $1,059, just above Wrangell Borough’s lowest statewide average of $888 (adjusted for utilities).

The data comes from an annual study of Alaska’s rental housing market by the Alaska Housing Finance Corporation and the Alaska Department of Labor and Workforce Development, which in March surveyed landlords statewide to gather data on approximately 15,000 units of housing. The results were released in the August edition of the Department of Labor’s monthly “Alaska Economic Trends” publication.

The report — by Juneau-based state economist Karinne Wiebold — shows that in terms of average rent and vacancies, the statewide rental housing market has changed only slightly since last year and relatively little this century. Average utility-included rent in Alaska is presently $1,238 — an increase of only .7 percent, or $9, from last year. In inflation-adjusted dollars, average statewide rent has increased about $100 since 2000. In the Kenai Peninsula Borough, this year’s increase in average rent is about 10 times greater than the state-wide number, at 7 percent.

Of the 11 study areas, Kenai not only came in second to Wrangell in lowest average rent, but tied with Wrangell for the most affordable. The study’s affordability index measured how many monthly paychecks would be required at the area’s average wage to afford the area’s average rent. Kenai and Wrangel were the only two areas where average rent is affordable on a single average-wage paycheck, although barely. Both scored .92 on the index. Kenai’s affordability index had dropped only .01 percent since 2000, indicating that wages have mostly kept pace with rent in the borough.

Matanuska-Susitna Borough had the least affordable rents in the study, requiring 1.26 average-wage paychecks to make the average rent affordable.

Although they measured similarly in two of the study’s indexes, Kenai and Wrangell are very different in terms of population. While Kenai Peninsula Borough has a population of 55,400, Wrangell City and Borough, located on a Panhandle island, has 2,369 people. Housing varies accordingly: the study surveyed 1,000 units of Kenai rental housing and 134 on Wrangell.

Of those 1,000 Kenai peninsula housing units, the survey found 88 unoccupied, equal to 8.8 percent. This rate placed the Kenai Peninsula near the top of the vacancy index, near Kodiak and Sitka, but below Ketchikan, which has 9.3 percent of its rental housing vacant, and Wrangell, with the second-highest vacancy at 9.7 percent.

Fairbanks, the location of Fort Wainwright Army base, was the high-end outlier of the vacancy index, with 11.2 percent. Wiebold noted in the study that “military movements and population changes have historically factored into Fairbanks’ vacancy rate shifts.”

Anchorage has Alaska’s most occupied rental housing market with a vacancy rate of 3.8 percent, followed by the Matanuska-Susitna Borough with 3.6 percent and Juneau with 3.3 percent.

Since 2000, Kenai’s vacancy rate has dropped from 12.3 percent, following a statewide downward trend. Over the same time period, state-wide vacancy rates have dropped slightly, from 6.6 percent to 5.8 percent.

 

Reach Ben Boettger at ben.boettger@peninsulaclarion.com.

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