Bad news for San Francisco renters – San Francisco recently claimed the title of most expensive city for renters in the U.S. Several sources have reported that at an average of ~$1,900 a month for a two bedroom unit, renters in San Francisco are facing prices not seen since the Dot-Com era boom. To put that in perspective, someone would have to earn a yearly income of approximately $75,000/year to put them in the the position to spend the nation’s average of 33% of their paycheck on rent alone. With no immediate end in sight to the lagging home ownership market and a huge influx of highly paid social-media boom tech workers looking for short-term leases, the market for rental properties is drying up. Going back to economics 101, we’re looking at a situation of rapidly dwindling supply, which inevitably leads higher demand and higher prices.
While San Francisco has traditionally been a favorable city for current renters (with strong tenant laws in place to prevent landlords from unfairly lifting prices on existing tenants), newcomers to the city will be met with an expensive, and competitive market. Foreclosures have also contributed to the influx of renters, with the additional issue of banks holding on to foreclosed properties that could become potential rentals. Although we’re beginning to see more of these previously owned homes coming onto the renting market, many experts agree it won’t be enough to meet demand. The phenomenon seems to be local as well, with the year over year increase in San Francisco County rents at 16%, the highest of any Bay Area county.
In this time of limiting supply and scarce new construction on the market, resale seems to be a primary option for home buyers in San Francisco. Get the information you need to stay ahead of the pack by contacting me at todd@climbsf.com, and check out my recent new construction updates to stay in the know about the future of San Francisco new developments: Madrone Pre-Sale Update
Climb Real Estate provides this information to the public and our clients and does not guarantee its accuracy. Climb Real Estate does not necessarily represent the seller nor the marketing company in any way. For buyer representation, contact Climb or learn how to buy new developments.
