Seattle landlords are leading the nation in facing rising insurance costs as average monthly insurance costs in the Seattle metro area rose 84.61% between 2019 and 2024 to $62.02 per multifamily unit, according to a study published by the Federal Reserve.
National landlords also faced rising insurance costs as nationally the average insurance cost increased 76.5% over the same period.
The study analyzed financial records of thousands of multifamily properties across the U.S. with commercial mortgage-backed securities loans. The data was compiled by analytics company Trepp.
Jake Mayson, director of government affairs at the Washington Multi-Family Housing Association, told the Business Journal that he attributed the sharp jump in insurance costs to the overall economic uncertainties and “increased risk out there in the environment. So every dollar that’s going to pay for property damage and higher insurance premiums, that’s a dollar not going into making the next renovation feasible, that’s not going into creating a new unit of housing to address our supply problems in Washington state.”
“There are larger per-dollar increases in insurance premiums in cities that are experiencing high amounts of property damage and property crime,” he said. The Fed study found that each additional dollar spent on property insurance reduced an owner’s net profit by roughly 75 cents. Insurance costs shaved off 3.83% of revenue for a typical landlord in 2024, up from 2.3% in 2019.
“It’s not like housing providers can raise the rent if their premium goes up,” WMFHA executive director Nick Marin told the Business Journal. “There’s a competitiveness in the market.”
