If you haven’t seen Mike Scott of Dupre + Scott present you’ve missed out. The best I can do is post his Power Point presentation from our Spring Dinner. I hope we’ll have Mike back on a regular basis. There are few in the real estate business that can present the basic facts of supply and demand like Mike. There’s a lot of good data in the presentation but I’ve posted what i think is the most interesting fact: operating costs are outpacing rent increases.

In the world of Seattle where many people claim that supply and demand doesn’t apply to the housing market, this slide makes an important point about costs that even supply deniers have to take seriously. Operating costs–largely composed of taxes and utilities–are a big part of rent increases. The fact that rents aren’t keeping up with costs is ominous. It means that adding more costs, like those associated with Councilmember O’Brien’s linkage tax, doesn’t make any sense no matter what you think about supply and demand. We need to be lowering costs, not adding to them.

You can find the full presentation here.