SFist Tonight
Week Around the Ists
SFist Tonight
You may want to squash those dreams over having your own studio is the TL. Lord knows we have. See, according to Curbed -- who has killed out Monday buzz, one that even Michelle Obama's jarringly bright red dress can't bring back -- rental prices have leaped more than 20% over the last two years in the city's cheapest neighborhoods: Downtown/Civic Center, the Haight and the Western Addition.
What's more, vacancy rates are standing still around 2-3%. Even with rent control being safe for now, "[t]his is dangerous stuff for the city's middle class," says Susie Cagle. And for the fistful of middle class ilk still left in the City, we agree. And those newfangled SROs are starting to look more and more tempting by the day. Alas. (Curbed)
Update: However, points out SFist commenter jcsnotes, "a lot has happened in the past 3 months," so we could, in fact, be in "the middle of what could be a drop in rents," but we'd have no way of knowing when using the 2006 prices as a benchmark. So: Monday buzz? Back on.
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An interesting but not too informative stat; rents are still up from 2006, but a lot has happened in the past 3 months. Put another way, we could be in the middle of what could be a drop in rents and you'd have no way of knowing it if you're still using 2006 as a benchmark.
good news, jcs! thanks.
this is purely anecdotal, but, I periodically check rents in my neighborhood and they certainly seem much higher than when I moved to the city 2.5 years ago.
They also seem to be trending up just from looking at the prices on similar units.
FYI: I'm in the Richmond district.
Hunters Point is going to be the new Mission dist.
it's all about the dogpatch.
Is there any incentive in this city for building more rental units? Supply is low, demand continues to be high, but I see a lot of vacant lots in this town. It's amazing how many empty lots with garbage there are in all the neighborhoods. I think our BOS should do more to encourage the construction of rental housing for all income brackets and not just for rich and poor.
Have you tried getting construction permits for an empty lot? Between the city and the nimbys, you're looking at five years before breaking ground. You've got to have a strong stomach, a healthy bank account and a magical bullshit suit.
The Supervisors would prefer to keep lots empty and tenants agitating for rent control than atually fix the problem.
aCtually. oops.
I am a landlord in the city and my family does real estate so I have two perspectives on the rising rent and the current economy.
First that saying that rent might fall in light of the weaker economy is true but I doubt its going to see a major drop. People will pick maybe not to live in SF if they dont have too, but, the option of buying a home is worst. What we see are people who would normally buy a home ending up renting because the lender are not willing to lend (yeah its not old news). So this means a flood of pretty decent people in the renting market, who either can buy a home but cant, or can no longer make that $3,000 a month mortgage payment. So renting to them looks cheap.
As for the question of building more rental property.. Oh god. My property is on the mission with 2 store front property and a single apartment on top. The rear backyard is actually LAGER then the property itself. We went out to get permits to build two more units in the back and the city rejected us. We ended up getting the green light to only add one more, and, if we remove one of our store front space we can add another unit the rear. This forced us to just get the plans drawn up but never built as the return would not be that great. Also the single apartment we do have is actually subdivided in to office space as we dont want to deal with the renter board. Sometimes the laws people think are their to protect renters end up hurting them as landlords are just not willing to offer the property up.
I wish I could afford to live here.
what I think people are forgetting is that the market here (read: real estate investors) collectively nods to one another in choosing their own pricing based upon a long term strategy. They tend to completely ignore supply and demand fluctuations and stubbornly price everything on the high end as if market conditions haven't changed. Pretend the market hasn't changed and effectively it hasn't. Brilliant, no?
It's kinda like when someone makes a stupid driving mistake...as long as they don't make eye contact, they did nothing wrong.
Sorry to bring the snark Brock. It's just I didn't think this was really informative. Rents are up from 2 years ago. Great. Tell me where they're going next month or next year and I'm interested. Tell me why and I'm even more interested.
Who am I kidding, I'm already interested. Keep up the good work.
I'm sure that landlords/developers face the unintended consequences of laws, that happens all the time. But I think that we should be clear about one thing: nobody is going broke being landlord.
Real estate agents continue to sell commercial units, vacant lots in my neighborhood (the mission) have been developed. Tear downs have sprung up boasting the latest in mid 2000 loft-style architecture, people are making money.
So yeah, there may be red tape, nimbys, and you may not get what you want, and some units will have to accommodate poorer people (which will depress your return on investment) and then the fed, state, and city will take their pound of your flesh.... but money is being made, and the return on investment is still outstanding.
which is why people are still doing it. the market works.
No, travin, landlords intentionally price high to avoid getting tenants who stay a long time. It's far, far better to have high turnover in SF, particularly if you ever want to sell your place ("Delivered Vacant" is worth $$$), than to have a long term tenant, however well behaved said tenant is.
It is helpful that San Francisco is a job center and fairly well-diversified - though the financial sector sure is taking it on the chin.
aj, that's exactly what I'm saying. hence my observation "long-term strategy", though it's much broader encompassing than just referencing rent-controlled tenants.
travin: your paranoid picture of collective-nodding is hilarious. Put down your copy of A Tale of Two Cities and join me at the Bastille, we're lopping heads.
Well my experience is I've got way more people asking me if I have any vacant apartments than ever before. And the tighter the tenant's union squeezes the landlords of this city the higher the rents go.
So are you saying that if the tenant's union suddenly stopped squeezing you'd just benevolently lower rents? This kind of assertion so irritated me during the recent rent control wars. You're going to raise them as high as the market will bear, and since this is San Francisco, that's pretty high.
fizandpop, thanks for the supportive vote of confidence, but the view isn't paranoid. It seems you're just parroting opinion column gossip and projecting a misread that it's intended as conspiracy theory spin. I worked in real estate for a time. Thanks anyway. you tried.
Gleparker, by the same token it's safe to say most employers these days have more people asking about job openings than ever before.
So are they just asking or actually renting? That's sorta key to the topic.
bluecanary, it's all about incentives. Rent control provides incentives to raise rent for vacant apartments ABOVE a normal market rent, to promote turnover. If it were easier to (for example) move into your OWN apartment, or decline to renew a lease in order to sell it vacant, this would not be the case.