SAN FRANCISCO (KPIX) – Rents continue to fall and disproportionately impact the San Francisco Bay Area housing market, according to a new study. Analysts at AdvisorSmith found that ten of the top 25 cities in the U.S. where rents are falling the most, are in the Bay Area, as compared year-to-year.
San Francisco is number 4 in the nation, after Odessa, TX (1); Midland, TX (2); and Williston, North Dakota (3).
Other Bay Area communities include Mountain View (5), Sunnyvale (6), Redwood City (8), San Mateo (11), Oakland (15) and San Jose (19).
The range of the drop has varied wildly based on location.
In San Francisco, rents have fallen from $2,650 per month to $2,081 since 2019. That’s a 26 percent drop.
In Walnut Creek (76), the rent drop was much less: only a 3.7 percent drop from $2,574 per month to $2,512.
“What we’re seeing is a lot of people are leaving the East Bay. People don’t have to live in the transit-oriented districts anymore. They don’t have to be next to BART,” said Jim Brennan, a realtor with Next Home Landcastle Luxury which specializes in the East Bay suburbs.
Brennan said a lot of people are moving out of densely populated areas as their companies are not requiring them to work at the office. That extra supply makes the rent go down.
“So once they know that they don’t need a lease in a small apartment for a year, then they can go find a less expensive place and maybe with a yard and with an office,” Brennan said.
Rents of single-family homes in Danville and other suburban communities are actually going up, Brennan said, because of a combination of that increased demand and a smaller number of single-family homes available on the market.
Brendan said he is projecting a reversal of these numbers as the pandemic eases, but that could take another year or even more.