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San Francisco, Silicon Valley rents plunge amid downturn

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Re: San Francisco, Silicon Valley rents plunge amid downturn

#51

Post by guenthert »

MajorBee wrote: post #29
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.

Might also be that people are preferring to not move in the coming months (thanks to COVID-19) and so the units that _are_ on the market simply aren't finding many buyers. I'm actually looking for a new place in the Bay Area next month -- some units have their sticker price uncharacteristically low for sure; many have some kind of specials running too, like first month rent free. I asked a few leasing reps if this is…

No, first month free or similar incentives has been common for at least fifteen years in the Bay Area. It's sadly also not uncommon that the first lease is considerably lower than following ones (for no other reason than the landlord betting on the inertia of the tenant).

Re: San Francisco, Silicon Valley rents plunge amid downturn

#52

Post by silentsea90 »

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.

Do you know when the mortgage payment forgiveness for publicly backed mortgages runs until? I heard it was 6 months or 1 year (not sure which). Do we expect a reckoning after this ie. if the economy is still suffering then

Re: San Francisco, Silicon Valley rents plunge amid downturn

#54

Post by tanilama »

Although I might benefit from this, but I have to point out that this is supposed to be the intern season, and there were always a surge in rent during this season in the past.

That is not happening this year. So comparing to last year, you are seeing a larger drop, but it will left to be seen whether the scale of this drop is temporary or long-term.

That said, the Bay Area landlords have benefited from the bloom for a decade, they are losing anything significantly, not yet.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#55

Post by hedora »

fiter wrote: post #41
ericmcer wrote: post #32

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 a…

You can't even evict people right now due to the emergency regulations. I wonder why the landlords are even bothering right now? Wait until after, evict for non-payment (one of the only easy ways to evict), then either try to collect or send back rent to collections and claim it as a loss and move on.

We were once evicted from an in-law unit without cause. They wanted the space back for use as a home office. (I suspect that’s extremely common these days)

In hindsight, we should have held out for a “make us move” offer. $10K’s is typical for that sort of situation in Berkeley.

We’re too nice, and moved without a fight, in return the landlord came up with some BS reason to withhold our security deposit.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#56

Post by LanceH »

sushisource wrote: post #50
xur17 wrote: post #26

Earlier quoted context omitted.

> Coincidently I have been seeing a lot of fully furnished units coming on the market which I assume were former Airbnbs. I've been noticing this as well (I can still find some of them on Airbnb actually). I'm currently in the market for a house, but wondering if waiting a year might be a wise move..

If you're staying in the same market and you already own, then it doesn't matter much. What matters more is that your other investments are relatively outperforming the house (likely already true because of the Fed's money printer). If you don't already own, waiting for a drop might be wise, but if you're going to sell stock to do it, you might wanna do it now. I'm looking at trading up to a new place right now and t…

If you're moving up in home value, it may be worth taking the loss on a smaller home to get a good price on a bigger on.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#57

Post by safog »

RcouF1uZ4gsC wrote: post #53

I expect in the near future, the urban rents in general will fall. Between COVID and rioting, living in a dense city just lost a lost of luster.

You overestimate our cultural attention span :)

Anyway, even with COVID + Rioting, I'd much rather live in a big city than in the countryside.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#59

Post by ra1n85 »

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.

Two things:

1. The consequences of having millions of unemployed people with bills to pay and no income are too much for a nation, let alone politicians in an election year. My bet is that the payments will be extended or replaced with something as the alternative is not viable.

2. WFH has already started normalizing, and will shortly become a differentiating perk offered by companies. I don't suspect that may of the people living in tech hubs would choose to continue doing so if they had the opportunity to live anywhere they wanted (of course while considering COL adjustment).

Re: San Francisco, Silicon Valley rents plunge amid downturn

#60

Post by guenthert »

ericmcer wrote: post #32

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 a…

In Germany about half the population is renting. That in itself doesn't mean they're not fostering a community. The difference of course is, that in Germany there are very stringent renter protections, so tenants do usually plan to stay for long times (a good share for a lifetime).
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