December is never the cleanest month to analyze. Most people don’t want to move around the holidays, and activity levels don’t always reflect broader market conditions. That said, December 2025 gave us useful insight into where the Portland rental market is heading as we move into the new year.
Looking across the Living Room portfolio, we closed out the year on stable footing, with clear differences depending on property type and pricing strategy.
December Leasing Performance: The Numbers
In December, incoming residents leased homes at an average of about 3% higher than outgoing residents, though that increase was not evenly distributed across property types.
Most of the upward movement came from smaller apartment properties that had been underpriced prior to onboarding. As those homes turned over, we were able to make appropriate upgrades to the units, bring rents closer to market without sacrificing lease-up performance.
Single-family homes that were already priced at market tended to lease flat or with modest increases under 2%. The condo market remained the most price-sensitive segment, with many accepting lower rents in order to end vacancy—a trend we’ve seen develop over the past year.
Condos: A Softer Segment Heading Into 2026
If a condo was leased at market rate two years ago, we’re seeing expectations of a 4–6% decrease if the home turns over in the first quarter of 2026. Because of that, many condo owners are choosing stability over turnover.
Rather than testing the market, some owners opted to:
- Hold renewal rents steady or offer a slight decrease for a long-term commitment (18-24 months)
- Offer a $200–$500 one-time rent concession
- Prioritize retaining a known, reliable resident
In this environment, those decisions often result in a stronger financial outcome than chasing a modest increase followed by vacancy and re-leasing costs.
What December Reinforced for Owners
December reinforced something we often talk about: strategy matters more than timing. While seasonal slowdowns are real, pricing discipline, home condition, and renewal planning play a much larger role in long-term performance than the calendar alone.
Well-prepared homes leased reliably, even during a slower month. Homes that were priced realistically, and supported with thoughtful renewal conversations, avoided unnecessary vacancy and protected owner cash flow.
Looking Ahead to 2026 Q1
As we move into the first quarter, we expect continued price sensitivity in certain segments, particularly condos and higher-end homes. Owners who leased at peak market rates in prior years should be prepared for flatter renewals or modest concessions as part of a broader stability strategy. Those classic 3-bedroom, 2-bathroom homes with a yard leasing under $2800/month will continue to move quickly if they are in good condition.
Our focus remains on helping owners make informed decisions, balancing rent performance, vacancy risk, and long-term outcomes, rather than reacting to short-term market noise.
Cheers to 2026 🥂
From the desk of President and Broker OR & WA – Coty Thurman