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San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

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Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#601

Post by MAGZine »

asdff wrote: post #596
MAGZine wrote: post #545

Earlier quoted context omitted.

if you do the math, it's expensive to let a unit sit for more than a couple months as opposed to offering a discount on the rent. This assumes your tenant will turnover in a couple years time, mind you. I did the math for SF and IIRC ~2mo was equal to a 15% discount. if it sits empty for longer than 2mo, you should have just given the 15% discount. if you let is sit for 2mo AND have to give a 15% discount, now you've…

I think properties are somehow valued based on the rent potential, so landlords are disincentivized to move base rent and would rather offer 1-2-3 months free and keep rent at standard rate.

you can easily take this into account too, and my calculation did. Assuming your tenant is staying for 2-3 years, you can really only afford to let it set empty for a few months. Your yearly rent increases are just a couple percent (tenths of pecents a month). Every month it sits empty is 8% of your yearly income for the unit.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#602

Post by MAGZine »

cnst wrote: post #560
MAGZine wrote: post #545

Earlier quoted context omitted.

if you do the math, it's expensive to let a unit sit for more than a couple months as opposed to offering a discount on the rent. This assumes your tenant will turnover in a couple years time, mind you. I did the math for SF and IIRC ~2mo was equal to a 15% discount. if it sits empty for longer than 2mo, you should have just given the 15% discount. if you let is sit for 2mo AND have to give a 15% discount, now you've…

You're ignoring the fact that SF has rent control; it resets only once a vacancy hits. If market rate was 3k a few months back, but is only 2k now, if you take a 15-year view, it's still cheaper to let your rent-controlled unit sit unrented for 12mo than rent it at just 2k for 15 years provided the 3k/mo rates recover in two years. Basically, that's one of the major reasons why rent-controlled units aren't going down…

No, I'm not forgetting that.

In my experience, most market rate units turn over every 2 or 3 years. 15 years in sf apartment leases are unusual except for people who cannot afford to move out.

If you assumption, as a landlord, is that the next person into your unit isn't moving for 15 years, then yes, the cost calculation moves. However, that calculation is very different from a 7 year calculation, which is very different from a 2 year calculation. So how much are you going to hedge against not losing money in the future, when you're losing concrete money right now?

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#603

Post by Daishiman »

carlob wrote: post #521
kelnos wrote: post #486

Earlier quoted context omitted.

Sure, but you don't get the variety. If you move out to rural France but are used to rotating among eating Mexican, Japanese, Chinese, Spanish, Thai, etc. throughout the month, you might be disappointed with the lack of choices.

You are probably used to this rotation just because you grew up in the US. As someone who has grown up in Italy we don't think about food this way, not even regionally. I.e. don't expect a great risotto in Naples or a decent carbonara in Milan...

This isn't a US thing, it's about cities with cosmopolitan tradition. Italians are the complete opposite of this culture.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#604

Post by Daishiman »

Bayart wrote: post #576
kelnos wrote: post #486

Earlier quoted context omitted.

Sure, but you don't get the variety. If you move out to rural France but are used to rotating among eating Mexican, Japanese, Chinese, Spanish, Thai, etc. throughout the month, you might be disappointed with the lack of choices.

Being in rural France, I like trying some new foreign cuisine once in while as much as anybody else, but it wouldn't come to my mind to make it my daily routine. Going out of your way to not eat local stuff is completely pointless to me. People take quite a lot of pride in having good stuff specific to their area.

In the Bay Area you can get, in the same weekend, excellent Vietnamese, excellent Peruvian, and excellent patisserie.

The ingredients are sourced locally for the most part, and the imports are about as good as they can get, and substitutions are sober.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#605

Post by gkop »

seanmcdirmid wrote: post #496
gkop wrote: post #202

Earlier quoted context omitted.

Flagstaff is a decent sized mountain town. Decent sized mountain towns have pretty good food and bars, including unique establishments. Of course they won’t please a true snob looking for a new home, but they plenty suit low key snobs like me. Last time I made a pit stop in Flagstaff it took 30 seconds on Yelp to find a great independent Cajun-creole joint with a pleasant patio, friendly staff, and delicious food and…

Do most old restaurants in SF own their property rather than rent? If they are renting, why are landlords passing down prop 13 property tax savings to them especially?

Most probably rent, but are part of an "ecosystem" which encourages keeping around old things.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#606

Post by bart_spoon »

bgorman wrote: post #159
joshgachnang wrote: post #95

Earlier quoted context omitted.

The WFH is a huge part. Just moved from a tiny 1 bed near downtown LA to a 3 bed place in Chicago with lower rent. My girlfriend and I both get our own offices, we have a yard, and enough places that are half open nearby that we're pretty happy.

Please report back in February after experiencing a -40 day :)

The winter gets cold. Big deal. From the way people talk these days you would think that human beings will shrivel and die if the temperature dips below 50F.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#607

Post by dyingkneepad »

Kalium wrote: post #455
scollet wrote: post #425

Earlier quoted context omitted.

Tech worker majority in SVBA have a choice to live 2 hours outside of the metro. Everyone else typically does not. The expectation is apt.

Personally, I'm not big on accepting personal blame for fifty years of bad urban planning decisions made by other people, almost entirely before I could vote. But I understand that that's not a helpful, satisfactory, or emotionally resonant response to someone looking for an enemy to accuse of wrecking everything they hold dear. Certainly not when they have someone who represents all those evils right before them. I'…

If I ever move to SF, I will print these words you wrote on a business card and hand to people when appropriate.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#608

Post by bart_spoon »

WillPostForFood wrote: post #429
01100011 wrote: post #390

Earlier quoted context omitted.

In the north central US, you have to stay indoors for a while because it's too cold. In the sunbelt, you have to stay indoors for a while because it's too hot. In CA, you have to stay indoors for a while because of the poor air quality. Take your pic. CA folks seem to think the rest of the world is an inhospitable wasteland. Sure, CA is a bit more mild, but it's not perfect.

In CA, you have to stay indoors for a while because of the poor air quality. Maybe once or twice per decade is the AQ so bad in CA you have to stay indoors. As opposed to weeks or months every winter (depending on your tolerance - I hate cold).

The entire Western US is in the midst of a climate change-induced super drought that is worst in at least 1400 years, probably longer. The air quality is degrading due to huge swaths of the area being engulfed is wildfire. Perhaps your statement was true for the past few decades, but certainly not now. Its not a fluke, its the new normal.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#609

Post by bart_spoon »

sagarm wrote: post #308
sjf wrote: post #121

Earlier quoted context omitted.

The positives have to out weight the negatives of high crime, a large homeless population, high rents, small apartments, etc. Having nice parks is not unique to SF.

The actual reason people are leaving the city are high rents and small apartments. How the hell do you work from home when you're sharing a place with roommates? And affording extra space for an office given current rents is a huge problem. Crime and homelessness, while problems, aren't major factors for people in my experience. After all, those two things haven't really changed.

> Crime and homelessness, while problems, aren't major factors for people in my experience. After all, those two things haven't really changed

I disagree. Its consistently brought up, along with high rent, as one of the worst parts of living in the area. In my experience, the people who stay in SF are willing tolerate it for access to all the amenities there. When the pandemic makes it difficult to enjoy those amenities, it will drive people away.

Re: San Francisco Apartment Rents Crater Up to 31%, Most in U.S.

#610

Post by srtjstjsj »

adjkant wrote: post #446
burlesona wrote: post #51

I would say the city being “closed” is the major driver. Among my group of ~40 coworkers, about 30 (including me) have left the city. As far as I know all but one were renting. Everyone who left gave the following rationale: - we can work remotely so move wherever or nomad now - SF is not very fun during the pandemic - WFH in my tiny apartment is much less enjoyable than when I was working in the office and didn’t sp…

What is curious to me is that NYC rents haven't seen the same crater at all (link says 15% but anecdotally most of the desirable top of market neighborhoods aren't budging). I don't buy the "SF is not very fun during the pandemic" rationale as more special than any other notable city, and NYC tends to have less space than SF. To me, that says the SF case has more complexity. IMO, the key factor here is that there app…

SF is tiny compared to NYC. Much more of a buffer in NYC.
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