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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

#141

Post by jedberg »

yalogin wrote: post #135
jedberg wrote: post #73

This article seems to be based on only a few transactions, as not a lot of people are actually moving right now. I manage a couple of properties in the Bay Area, so I keep a close eye on these things. What I'm seeing is not a drop in rents, but an increase in $0 deposits and many weeks of free rent upon move in (sometimes 6+ weeks). Landlords are very reluctant to lower rents, because with the statewide rent control…

Its just another way of saying landlords need to incentivize renters. So the market has definitely changed. I feel this is a stopgap measure and that rents must come down eventually. At that point the incentives will stay too.

During the last downturn in 2008, only the highest rents in SF dropped. The rest of the Bay Area just stayed flat for a few years.

This downturn may be different because of the shift to work-from-anywhere in tech, but it will be interesting to see. A lot of people like their tech offices, with their free lunches and snacks and gyms and coffee and so on.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#142

Post by pb7 »

jedberg wrote: post #130
FreedomToCreate wrote: post #113

My community has dropped prices 10% and is offering 1 month free (4 year old complex in north san jose). However they are not offering this to current renters whose renewals are coming up. They offered me a 0% increase and when I cited that the 5 other identical apartments are currently available for essentially 20% off (10% discount over 12 months plus one month free), they began been pushing the narrative that the…

You're actually in a pretty strong position. Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. If you lease ends on July 1, you can turn in your keys on June 30 and walk away. Your landlord knows this. Rents won't go back up in July. Even if the economy recovers 100% in the next two weeks, most tech employers in the area are doi…

>Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends.

Every lease I've ever signed required 30 days notice from either party to end the lease when the lease term ends, otherwise it proceeds on a month to month basis with no further action required.

Edit: Technically not required in California but confirmed that it was in fact required for a previous state I lived in.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#143

Post by t3rabytes »

jedberg wrote: post #130
FreedomToCreate wrote: post #113

My community has dropped prices 10% and is offering 1 month free (4 year old complex in north san jose). However they are not offering this to current renters whose renewals are coming up. They offered me a 0% increase and when I cited that the 5 other identical apartments are currently available for essentially 20% off (10% discount over 12 months plus one month free), they began been pushing the narrative that the…

You're actually in a pretty strong position. Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. If you lease ends on July 1, you can turn in your keys on June 30 and walk away. Your landlord knows this. Rents won't go back up in July. Even if the economy recovers 100% in the next two weeks, most tech employers in the area are doi…

> Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends.

This isn't guaranteed. In my case (renter in North Carolina), even at the end of my lease I have to give a 60 day notice prior to the lease-end or else my lease switches to month-to-month automatically.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#144

Post by t3rabytes »

pb7 wrote: post #142
jedberg wrote: post #130

Earlier quoted context omitted.

You're actually in a pretty strong position. Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. If you lease ends on July 1, you can turn in your keys on June 30 and walk away. Your landlord knows this. Rents won't go back up in July. Even if the economy recovers 100% in the next two weeks, most tech employers in the area are doi…

>Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. Every lease I've ever signed required 30 days notice from either party to end the lease when the lease term ends, otherwise it proceeds on a month to month basis with no further action required. Edit: Technically not required in California but confirmed that it was in fact requi…

Jinx, just commented the same thing. Mine is even 60 days!

Re: San Francisco, Silicon Valley rents plunge amid downturn

#146

Post by jedberg »

raincom wrote: post #138
jedberg wrote: post #73

This article seems to be based on only a few transactions, as not a lot of people are actually moving right now. I manage a couple of properties in the Bay Area, so I keep a close eye on these things. What I'm seeing is not a drop in rents, but an increase in $0 deposits and many weeks of free rent upon move in (sometimes 6+ weeks). Landlords are very reluctant to lower rents, because with the statewide rent control…

That's the first step, and this has happened many times before. No REIT drops rents; instead, they offer "$0 deposit", "no rent for the first 45 days", etc. Once these tricks are exhausted, rents will drop. The issue is: how long does it take for these tricks to exhaust?

In 2008 rents in the Bay Area just stayed flat for a few years except in the most expensive parts of SF. So in 2008 at least, those incentives were enough. This time may be different though, with a fundamental shift to work-from-anywhere for tech companies.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#147

Post by mywittyname »

pathseeker wrote: post #99
safog wrote: post #57

Earlier quoted context omitted.

You overestimate our cultural attention span :) Anyway, even with COVID + Rioting, I'd much rather live in a big city than in the countryside.

It happened once before: https://en.wikipedia.org/wiki/White_flight

These people have figured out how to have their cake and eat it too. Major cities in the US have grown large enough that the ghettos can be reasonably far from the wealthier parts of town. That, plus racial profiling from both police and citizens, serves as an effective divide.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#148

Post by jedberg »

t3rabytes wrote: post #143
jedberg wrote: post #130

Earlier quoted context omitted.

You're actually in a pretty strong position. Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. If you lease ends on July 1, you can turn in your keys on June 30 and walk away. Your landlord knows this. Rents won't go back up in July. Even if the economy recovers 100% in the next two weeks, most tech employers in the area are doi…

> Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. This isn't guaranteed. In my case (renter in North Carolina), even at the end of my lease I have to give a 60 day notice prior to the lease-end or else my lease switches to month-to-month automatically.

Check your lease, but at least on my leases, it says that it only goes month to month if you pay the rent and the landlord accepts. If you don't pay the rent, the lease just ends.

It's certainly a nice courtesy to let them know if you're leaving, but at least in California, it isn't required by law.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#149

Post by jedberg »

pb7 wrote: post #142
jedberg wrote: post #130

Earlier quoted context omitted.

You're actually in a pretty strong position. Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. If you lease ends on July 1, you can turn in your keys on June 30 and walk away. Your landlord knows this. Rents won't go back up in July. Even if the economy recovers 100% in the next two weeks, most tech employers in the area are doi…

>Normally to leave a lease you need to give notice, usually 30 days. But there is one time you don't have to do that -- when the lease ends. Every lease I've ever signed required 30 days notice from either party to end the lease when the lease term ends, otherwise it proceeds on a month to month basis with no further action required. Edit: Technically not required in California but confirmed that it was in fact requi…

I replied below to the other person saying the same thing. In California this is not the law, but they should check their lease.

Re: San Francisco, Silicon Valley rents plunge amid downturn

#150

Post by orwin »

jbay808 wrote: post #95
sushisource wrote: post #50

Earlier quoted context omitted.

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…

Doesn't "the Fed's money printer" inflate housing just as much as other assets?

With a lag, and it really depends on the area and how many people benefit from money printing. If the scheme is QE like in europe, the housing prices will not gain as much as the market prices in low to middle-class area.
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