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San Francisco, Silicon Valley rents plunge amid downturn

sfchronicle.com

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Re: San Francisco, Silicon Valley rents plunge amid downturn

#31

Post by hkmurakami »

DevX101 wrote: post #5

Looks like people are really leaving the Bay Area. you don't see 10-15% price drops in a year without corresponding drop in demand.

Supply increased significantly due to condo and SFH owners opting to wait it out until 2021 rather than test the sales market (listed as rental and willing to offer competitive prices since they’re sensitive to vacancies). This is driving the General strength in sales pricing for Bay Area housing. Demand for buying has come back strong in May while supply’s return is slow. I do see listings picking up in the last 2 weeks. Summer will be interesting.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#32

Post by ericmcer »

This also might open many landlords eyes to how ugly their situations can get when they want to remove a tenant in Oakland/SF/Berkeley even if a tenant stops paying rent. I have two friends who are currently refusing to leave in-law units and it is quickly getting bad for their landlords ($30k deal to get one of them to leave). That said I totally welcome this, part of the reason why our communities suck in the bay area is because everyone is renting. Owners have a vested interest in creating a nice place to live while landlords and renters have less reasons to care.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#35

Post by xyzzy_plugh »

DevX101 wrote: post #5

Looks like people are really leaving the Bay Area. you don't see 10-15% price drops in a year without corresponding drop in demand.

As an anecdote, I left the Bay Area (and California (and the USA)) in January.

Amongst my cohorts/closest friends I know in the Bay Area: - one moved to Colorado a year ago. - another moved to Berkeley from SF, to buy a house. - several moved to New York City and Seattle. - a few moved back to Canada.

In my time in the Bay Area, it always seemed like there was constant migration: some folks leaving, some folks just arriving. Usually more of the latter.

Due to the current pandemic, I'd definitely guess that the rate of folks leaving hasn't changed significantly (compounded with layoffs, etc.) but the rate of folks arriving certainly has! No interns are flying out, no recent grads are moving in.

If things "return to normal" then I'd expect this to revert, but those people aren't just milling about waiting for the gates to open. They're finding other opportunities, and when the dust settles, the opportunities in the Bay Area aren't going to be the highly competitive opportunities they once were.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#36

Post by teachrdan »

akhilcacharya wrote: post #28
Splendor wrote: post #9

> The 9.2% drop in the average one-bedroom San Francisco rent of $3,360 still leaves it unaffordable for the vast majority of city residents. Yeah, that's not much of a drop.

For a 1-bed that's actually $500-700 cheaper than it is in my area (Kendall Sq. in Cambridge).

But you're comparing the rent in a small part of one city to the average rent for an entire city. One could cherry pick the rent in a comparably small neighborhood in San Francisco (the Mission, the Marina) and find it even higher than in Kendall Square.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#37

Post by thorwasdfasdf »

pokstad wrote: post #27
jcomis wrote: post #14

I think the reality will set in soon on this once the CARES bonus UI is removed (and if it is not replaced) and the PPP loans run out. Right now everyone I know in real estate is still convinced it was just a minor blip and love to cite cherry picked stats about how a recovery is already under way. Coincidently I have been seeing a lot of fully furnished units coming on the market which I assume were former Airbnbs.

> Coincidently I have been seeing a lot of fully furnished units coming on the market which I assume were former Airbnbs. Wow. Does anyone have an estimate of the cost of living increase caused by Airbnb rentals?

specifically, it's the tourists causing the cost increase. airBnb is just the facilitator. if they weren't going to airbinb they would've gone to hotels or people renting out their apartments.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#38

Post by yodon »

hkmurakami wrote: post #31
DevX101 wrote: post #5

Looks like people are really leaving the Bay Area. you don't see 10-15% price drops in a year without corresponding drop in demand.

Supply increased significantly due to condo and SFH owners opting to wait it out until 2021 rather than test the sales market (listed as rental and willing to offer competitive prices since they’re sensitive to vacancies). This is driving the General strength in sales pricing for Bay Area housing. Demand for buying has come back strong in May while supply’s return is slow. I do see listings picking up in the last 2 w…

Can you explain more about this?

Re: San Francisco, Silicon Valley rents plunge amid downturn

#39

Post by driverdan »

Finnucane wrote: post #13
DevX101 wrote: post #5

Looks like people are really leaving the Bay Area. you don't see 10-15% price drops in a year without corresponding drop in demand.

Also, a drop in money, as in, a lot of people suddenly don't have any. And not just people leaving, but people not moving in.

The majority of people who lost income are not the ones buying real estate in the bay.
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