Key Highlights
- One bedroom rents fell -9.2% y/y in May, largest rent drop in over 3 years
- Average price for one-bedroom in San Francisco now $3,360 from $3,700 last year in May
Zumper, the San Francisco-based apartment rental site, just released its latest rental figures report for The City. All the rumors are true. Anthemos Georgiades, CEO of Zumper, said, “All this talk of people leaving S.F. for a future of remote work is now backed up by hard data.”
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Rent for a one-bedroom unit in San Francisco is now $3,360…it was $3,700 in May of last year. Rental numbers in Silicon Valley fell even further. Google’s home in Mountain View saw the price of a one-bedroom unit drop -15.9% in consecutive years in May 2020. In Facebook’s Menlo Park, rents saw a -14.1% drop in rental prices, Apple’s Cupertino saw rental prices plunge -14.3% in May and Tesla’s Palo Alto saw prices lower by -10.8% in May.
Georgiades said that some of these published rent drops may be much too conservative as “some landlords conceal price drops in ‘lease specials’ like six weeks of free rent to move in.’” Rent price “specials” listed on Craigslist translate into weeks, sometimes 8 weeks, sometimes 10 weeks of free rent.
East Bay cities such as Berkeley and Oakland are not seeing similar rent price declines as in San Francisco and the South Bay. Berkeley saw a less than 1% rent price decline and Oakland rental prices for a one-bedroom unit actually rose +4.9%, according to Zumper.
Will this rental price drop brought on by the COVID pandemic have any staying power? Kim-Mai Cutler, a partner at Initialized Capital, wrote on Twitter, “I wouldn’t be so fast…once things open up or the pandemic passes in 1-3 years, there will be a lot of good deals/prices, possible energy to come back.”
Right. San Francisco still remains the most expensive market in the country…ahead of New York City, Boston, San Jose. all of which have seen negative y/y rent changes for their respective one-bedroom unit rents.
Thanks to Curbed.
Also read: Elliman Challenges StreetEasy’s (Zillow’s) Latest Move to Manual Listings Entry, Top Zip Codes with Highest Equity Rich Shares & Underwater Properties in Q4 2019, Boston Seen as Best 2020 Multi-Family Market
