SAN FRANCISCO (KPIX 5) — The decrease in Bay Area rental prices has been significant this year, especially in the most expensive cities. Some median prices have even dropped by double-digit percentages.
San Francisco is still the most expensive city in the country to rent an apartment. But new numbers show there’s been an exodus of residents who have better options. Renters are simply walking away from their leases.
“People are leaving and ditching their apartments, or leaving roommates hanging, or trying best to find a sublease or just leaving San Francisco and moving back home,” said tech salesman Anthony Natoli, who decided to move back to New Jersey with his parents after paying more than $4,000 a month for his apartment in Cow Hollow.
“All of the normal things that we see as driving demand for rental housing in San Francisco have pretty much dried up,” said J.J. Panzer, President of Real Management Company.
In June, rent prices year-over-year dropped more than 9% in San Francisco, Mountain View more than 15%, and Cupertino down 14% according to Zumper, which provides listings of available rental properties and services.
“A lot of people are moving out to Southern California, moving out to Central Valley, moving up to the Sacramento area, Tahoe, and Sonoma County,” said Bobby Fallon of Shamrock Moving Storage. “It’s definitely been a trend that’s going on. ”
A new survey from the San Francisco Apartment Association shows more than 7% of renters simply broke their leases over the last three months.
Some 2.7 million adults in the country moved in with their parents in March and April. That’s a trend that could lead to more than $700 million in lost rent for landlords this year according to Zillow, an online real estate database company.
“Landlords want a commitment that they’re not going to have a vacancy at this time when we’re looking at with such incredible supply and lots of units opening up and no demand to fill it,” said Panzer.
There may be a way for renters to take advantage of the trend if they approach it correctly.
“You’ll get farther by recognizing landlords want that base rent to be kept basically where it’s at,” said Panzer. “Ask for a free month’s rent. Sign a new one-year lease and the effective rate goes down for 13 months essentially.”
According to Zillow the most affordable cities in the Bay Area now are Vallejo and Concord with the median rent for a one-bedroom going from $1450-$1750.