“Oakland is the less expensive alternative to San Francisco,” said Sarah Bridge, president of RealFacts, a Novato company that collects information on rents at large, professionally managed apartment complexes. “It’s an urban core and offers some of the same amenities on a small scale, and is still about $800 (a month) less expensive than San Francisco. It’s a spillover from the growth occurring in San Francisco.”

The average asking rent at buildings with at least 50 units in Oakland hit $1,925 in the third quarter, up 19 percent from the same time last year, RealFacts said. That figure averages rents for units ranging from studios to three bedrooms, but the trend is just as pronounced for each size. One-bedroom apartments, for instance, were asking $1,761, a 20.1 percent increase from a year ago, RealFacts said.

San Francisco’s already sky-high rents continued climbing, with a new average asking of $2,768 at big complexes, up 7.6 percent from a year ago. San Jose saw a 9.6 percent increase to an average of $1,845, RealFacts said.

Apartment hunters on both sides of the bay are reeling from sticker shock.

Matt and Jennifer Renner are moving back to the Bay Area after a few years living in Brooklyn and Boulder, Colo. They’re seeking a two-bedroom in Oakland for about $1,900, Despite both having stable employment, good credit and excellent references, the pickings are slim.

“In the four years we’ve been gone, it’s staggering how much the rents have gone up,” Matt Renner said. “We considered looking at San Francisco, but the rental market there was crazy, comparable to Manhattan.”

Big increases in 4 years

In 2008 when they were last here, it was a different story, he said. “I was in a three-bedroom, really nice house in the Lower Haight for $3,000 a month,” Renner said. “My wife had a nice one-bedroom in a safe neighborhood in Oakland for $875 a month. Now that’s almost doubled.”

In San Francisco, what passes for good news is that the trajectory for rent hikes appears to be slowing, which might mean the market is close to saturation.

“It’s not as if San Francisco is going to experience a rent drop, but I think it’s gone as far as it can go,” Bridge said. She said she thinks San Francisco is following a pattern set by East Coast cities such as New York and Washington, which saw rapid price appreciation and now appear to have maxed out the increases.

“It’s not a demand issue; there would be more people willing to rent an apartment (in San Francisco). It’s affordability,” she said. “There aren’t that many high-paying jobs that (landlords) can just keep raising the rents to ridiculous levels.”

People who are apartment- hunting in San Francisco continue to report that it’s a blood sport.

‘Massive changes in wealth’

Bo Lu, co-founder and CEO of FutureAdvisor, which offers online financial advice, is moving his seven-person Seattle startup to San Francisco to be closer to the talent pool and the startup community.

He and his girlfriend, Marlo Struve, hired real-estate agent Wendy Willbanks, who runs an “apartment concierge” company called She Moves You, to help them look. After four intensive days of touring more than a dozen units, they signed a lease on a two-bedroom in the Castro for $3,200 a month, including parking.

“The cost was enormous in both time and money,” he said. His theory about the escalating rents takes a macroeconomic view of the tech boom.

“Many startups like mine are replacing humans with computers,” he said. “Whenever you take an industry that used to employ tens of thousands and instead employ a few hundred engineers, you end up with massive changes in wealth. Engineers are being paid a lot, so they are bidding up these insane prices.”

Willbanks, who sees plenty of units in her capacity as an apartment scout, said the rent increases are astounding.

“It’s just insane; $3,000 a month is a mortgage payment,” she said. “Some of the square footages (for that) are horrendous. These places are 600 to 900 square feet, and they’re charging three grand a month.”

Target for investors

The escalating rents make Bay Area cities increasingly attractive targets for large-scale real estate investors.

Ivanhoé Cambridge, the real estate subsidiary of a major institutional fund manager in Quebec, has spent more than $600 million in the past year buying apartment complexes from Cupertino to San Jose, totaling 2,300 units. It plans to build a high-end, 648-apartment complex in San Jose in partnership with Shea Properties, breaking ground in the spring with occupancy in about 2 1/2 years.

“We like the dynamic of the employment base. We like the fact that there are natural barriers to entry in the area,” said Sylvain Fortier, president of the residential division. “We like the combination of more tenants in an environment where new supply may not meet demand. We are seeing market increases on rents that are (already) fairly substantial. That will not continue forever, obviously.”

Managing expectations

Lu, the Seattle entrepreneur who is moving his company here, said he knows his employees will confront similar challenges when they house-hunt.

“When I get back, I will tell my team to manage their expectations,” he said. “In Seattle you can get a 700- or 800-square-foot place with parking in a nice neighborhood with a view of the water for $1,000 a month. They should budget time, be patient and expect prices that we’ve never seen before, even though we live in a metropolitan area. This is an order of magnitude beyond what I’ve ever seen.”

Carolyn Said is a San Francisco Chronicle staff writer. E-mail: csaid@sfchronicle.com

Article source: http://www.sfgate.com/business/article/Apartment-rents-rise-in-Oakland-San-Francisco-3961019.php

“Oakland is the less expensive alternative to San Francisco,” said Sarah Bridge, president of RealFacts, a Novato company that collects information on rents at large, professionally managed apartment complexes. “It’s an urban core and offers some of the same amenities on a small scale, and is still about $800 (a month) less expensive than San Francisco. It’s a spillover from the growth occurring in San Francisco.”

The average asking rent at buildings with at least 50 units in Oakland hit $1,925 in the third quarter, up 19 percent from the same time last year, RealFacts said. That figure averages rents for units ranging from studios to three bedrooms, but the trend is just as pronounced for each size. One-bedroom apartments, for instance, were asking $1,761, a 20.1 percent increase from a year ago, RealFacts said.

San Francisco’s already sky-high rents continued climbing, with a new average asking of $2,768 at big complexes, up 7.6 percent from a year ago. San Jose saw a 9.6 percent increase to an average of $1,845, RealFacts said.

Apartment hunters on both sides of the bay are reeling from sticker shock.

Matt and Jennifer Renner are moving back to the Bay Area after a few years living in Brooklyn and Boulder, Colo. They’re seeking a two-bedroom in Oakland for about $1,900, Despite both having stable employment, good credit and excellent references, the pickings are slim.

“In the four years we’ve been gone, it’s staggering how much the rents have gone up,” Matt Renner said. “We considered looking at San Francisco, but the rental market there was crazy, comparable to Manhattan.”

Big increases in 4 years

In 2008 when they were last here, it was a different story, he said. “I was in a three-bedroom, really nice house in the Lower Haight for $3,000 a month,” Renner said. “My wife had a nice one-bedroom in a safe neighborhood in Oakland for $875 a month. Now that’s almost doubled.”

In San Francisco, what passes for good news is that the trajectory for rent hikes appears to be slowing, which might mean the market is close to saturation.

“It’s not as if San Francisco is going to experience a rent drop, but I think it’s gone as far as it can go,” Bridge said. She said she thinks San Francisco is following a pattern set by East Coast cities such as New York and Washington, which saw rapid price appreciation and now appear to have maxed out the increases.

“It’s not a demand issue; there would be more people willing to rent an apartment (in San Francisco). It’s affordability,” she said. “There aren’t that many high-paying jobs that (landlords) can just keep raising the rents to ridiculous levels.”

People who are apartment- hunting in San Francisco continue to report that it’s a blood sport.

‘Massive changes in wealth’

Bo Lu, co-founder and CEO of FutureAdvisor, which offers online financial advice, is moving his seven-person Seattle startup to San Francisco to be closer to the talent pool and the startup community.

He and his girlfriend, Marlo Struve, hired real-estate agent Wendy Willbanks, who runs an “apartment concierge” company called She Moves You, to help them look. After four intensive days of touring more than a dozen units, they signed a lease on a two-bedroom in the Castro for $3,200 a month, including parking.

“The cost was enormous in both time and money,” he said. His theory about the escalating rents takes a macroeconomic view of the tech boom.

“Many startups like mine are replacing humans with computers,” he said. “Whenever you take an industry that used to employ tens of thousands and instead employ a few hundred engineers, you end up with massive changes in wealth. Engineers are being paid a lot, so they are bidding up these insane prices.”

Willbanks, who sees plenty of units in her capacity as an apartment scout, said the rent increases are astounding.

“It’s just insane; $3,000 a month is a mortgage payment,” she said. “Some of the square footages (for that) are horrendous. These places are 600 to 900 square feet, and they’re charging three grand a month.”

Target for investors

The escalating rents make Bay Area cities increasingly attractive targets for large-scale real estate investors.

Ivanhoé Cambridge, the real estate subsidiary of a major institutional fund manager in Quebec, has spent more than $600 million in the past year buying apartment complexes from Cupertino to San Jose, totaling 2,300 units. It plans to build a high-end, 648-apartment complex in San Jose in partnership with Shea Properties, breaking ground in the spring with occupancy in about 2 1/2 years.

“We like the dynamic of the employment base. We like the fact that there are natural barriers to entry in the area,” said Sylvain Fortier, president of the residential division. “We like the combination of more tenants in an environment where new supply may not meet demand. We are seeing market increases on rents that are (already) fairly substantial. That will not continue forever, obviously.”

Managing expectations

Lu, the Seattle entrepreneur who is moving his company here, said he knows his employees will confront similar challenges when they house-hunt.

“When I get back, I will tell my team to manage their expectations,” he said. “In Seattle you can get a 700- or 800-square-foot place with parking in a nice neighborhood with a view of the water for $1,000 a month. They should budget time, be patient and expect prices that we’ve never seen before, even though we live in a metropolitan area. This is an order of magnitude beyond what I’ve ever seen.”

Carolyn Said is a San Francisco Chronicle staff writer. E-mail: csaid@sfchronicle.com

Article source: http://www.sfgate.com/realestate/article/Rents-rise-in-S-F-Oakland-San-Jose-3961019.php

“We started combing Craigslist, and when we filtered by the neighborhoods we want and our maximum price of $2,000 for a two-bedroom, there is almost nothing,” Austin said. “It was just shocking to me.”

They broadened their search to the East Bay. Even there, “You show up at an open house and it’s really intimidating,” he said. “There are 20 other couples already ready to apply.”

They decided to “get creative and get off the Craigslist merry-go-round,” he said, posting their search on Facebook and placing their own Craigslist “apartment wanted” ad. A Facebook friend shared a tip on an Oakland apartment that may work out for them.

Their story is typical of San Francisco’s overheated rental market, where well-compensated tech workers are flocking to desirable neighborhoods, driving up prices and locking out those who aren’t big earners. The chichi areas, which also are closest to convenient transit, are hardest to break into. And the competition is spilling over into the East Bay.

“The Bay Area is growing in an extraordinary, unprecedented way,” said Sarah Bridge, owner of Novato’s RealFacts, which tracks apartment prices nationwide at buildings with 50 or more units.

“It has to do with job growth,” she said. “It’s a gold-rush mentality where the best and the brightest come to the Bay Area. The trend is for Gen Y folks, which is mostly what employers are hiring, and that particular generation has a preference for the urban core.”

San Francisco rents rose 15.8 percent in the first quarter of this year compared with the same time last year, to an average of $2,663 for all size units, according to RealFacts. Studio apartments average $2,075, up 16.5 percent in a year. The steepest rise came in one-bedroom, one-bathroom apartments, which are now $2,611 – up 19.9 percent in the past year and up 30 percent from just two years ago.

Growth was also strong in San Mateo County, where units of all sizes average $2,003, a 15.6 percent annual increase, RealFacts said. In Santa Clara County, the $1,857 average rent is a 12.5 percent annual increase. For Alameda County, the $1,519 average rent is up 7 percent – still a big increase compared with other areas of the country.

“When you see markets like Oakland with rental growth, it’s because it has proximity to San Francisco rather than in and of itself doing anything,” Bridge said.

San Francisco is the most expensive metropolitan area in the country for renters, according to a recent report from the National Low Income Housing Coalition, which compared rents to wages. The going rate for a two-bedroom apartment in the counties of San Francisco, Marin and San Mateo requires a $76,200 annual income, the report said. By contrast, the New York metropolitan area, which includes eight counties, requires a $56,950 annual salary.

Even well-paid workers can find it hard to navigate San Francisco’s blood-sport rental market.

That’s spurred the creation of services targeting them. Real estate agent Wendy Willbanks last year decided to become a scout, or “rental concierge,” for apartment hunters, calling her business She Moves You (shemovesyou.com).

“I swoop in and beat the competition,” Willbanks said. “It’s a fast track to jumping them ahead of the long lines of other applicants (and) landing a rental property in San Francisco without wasting time.”

After nailing down her clients’ wish lists, Willbanks sifts through listings and attends open houses, armed with her clients’ credit reports and renter profiles. She photographs and videos the spaces. Some clients, such as people moving from elsewhere in the country, decide on apartments based purely on her scouting.

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2012/05/09/BU551OD1PL.DTL&tsp=1

With tech workers flocking to the Bay Area again and the homeownership market still sluggish, local demand for rental housing is spiking and prices are on the rise, according to new data gathered by Novato-based RealFacts.

The combination of factors is driving people to choose — and then beg — to rent. The occupancy rate in The City rose 6 percent between 2010 and 2011 — meaning there are fewer apartments available on the market — and the average cost of all rentals went up from $2,214 to $2,422, according to RealFacts data.

Sarah Bridge, owner of RealFacts, theorized that members of Generation Y just don’t want to be tied down in the real estate market, especially not in the suburbs.

“That demographic is moving more toward rentals in a tight-knit, walkable community,” Bridge said.

The new data matches what countless apartment hunters already know. Even if you have the credit score report and boilerplate rental application in hand to try to beat out the competition — and especially if you’ve already given the 30-day notice on your current place — life is not getting easier for The City’s potential tenants.

That clock is ticking for 29-year-old nonprofit employee Allyse Heartwell and her tech worker boyfriend. After the couple suspected they had been outbid by other tenants on a place they really liked, they decided they would fight back at some open houses on Wednesday.

“If we like the place, we are going to bid $100 up,” Heartwell said, adding that she tried to bid $50 over the asking price on a previous place, but to no avail. “It’s like they should start putting these places on eBay.”

Because the couple’s options are narrowed by the fact they have a dog and are interested only in certain neighborhoods, they see some of the same people at the open houses.

“We definitely smile at each other, but we don’t really chat with them,” she said.  “You just go for 15 minutes, then you have to leave to get to the next one.”

Abigail Glynn, a broker with Davis Realty Co., said she’s noticed a resurgence in The City’s rental market. She said the demand is no surprise, considering increased hiring at tech companies that are now better established than they were during the dot-com bubble a decade ago.

“I’m getting Google people and they’re making money,” Glynn said. “We’re getting the second wave of dot-com kids.”

dschreiber@sfexaminer.com

Rents on the rise

Average San Francisco rental
Second quarter 2010: $2,214
Second quarter 2011: $2,422

Average rent cost per unit type
Loft: $2,100
Studio: $1,821
One bedroom: $2,229
Two bedroom, one bath: $2,394
Two bedroom, two bath: $3,272
Three bedroom, two bath: $2,975
Three bedroom, three bath: $3,609

Source: RealFacts

Article source: http://www.sfexaminer.com/local/2011/08/new-wave-tech-workers-san-francisco-becomes-landlord-s-market

Compared to second-quarter data from 2010, rents rose 8.6 percent in San Francisco and 9.3 percent in San Mateo County, for monthly averages of $2,400 and $1,800 respectively.

The trend can be pegged to a dwindling rental supply and increasing demand from new workers with high-paying jobs, according to RealFacts owner Sarah Bridge.

“Talent is coming into the area. It’s not that there are so many jobs, but the ones out there are paying well,” Bridge said, adding that although the new tech boom is similar to the dot-com bubble of 2000, it is bringing workers with a more experiential, less materialistic mindset. “They’re not big into being tied down to a big piece of real estate.”

According to the real estate data aggregator Zillow.com, 480 homes were sold in San Francisco in May, down 22 percent in a year-over-year comparison. Meanwhile, RealFacts data show supply running out in San Francisco and San Mateo County, both with a 96 percent occupancy rate, up 6 percent and 1 percent, respectively.

The factors are helping San Francisco maintain its status as one of the most expensive big-city rental markets in the country, which has advocates for current tenants taking notice.

“It’s making it a landlord’s market,” said Ted Gullicksen, executive director of the San Francisco Tenants Union. “We could see more evictions, more tenant buyouts.”

Gullicksen said although The City’s rent-control standards keep some costs in check for renters, state law prevents the controls from being applied to units themselves. Like in 2000, Gullicksen said, he fears without cheaper options, residents could be pushed to the outskirts of the Bay Area.

“I think we’re headed back in that direction,” he said.

Of the 43 markets examined by RealFacts, 41 posted rent increases, with the biggest gains seen in the Bay Area. San Jose, the unofficial capital of Silicon Valley, experienced the largest increase at 6.6 percent, up from $1,650 to $1,759 per month.

dschreiber@sfexaminer.com

Average rent per unit type

Average rent increase

Source: RealFacts

Article source: http://www.sfexaminer.com/local/peninsula/2011/07/influx-workers-drives-rental-rates-san-francisco-and-san-mateo-county

The last one bit the dust 10 days ago, when San Francisco Ford Lincoln Mercury, on Van Ness Avenue’s Auto Row, shut its doors without warning or explanation.

“We’re referring people to Serramonte and other dealers in the Bay Area,” said Roger Bramble, a service department manager, who along with about 50 other employees will be out of a job when the remaining servicing and repair jobs are done.

From what we can gather, the dealership, Ford’s only one in San Francisco after SC Ford in the Castro closed in 2008, had been on the block for some time. Ford had taken control of the dealership three years ago, when the original franchisee handed back the keys.

The owner of Journey Ford Lincoln in Novato, Ali Omoomy, had been looking to take it over, but walked away a couple of months ago, I was told. Other interested buyers subsequently faded away, prompting Ford finally to cut bait.

Referring to the “very tough decision” to close the dealership, Ford Lincoln Mercury President Mel Turner, said, in a statement, “We are proud to have served the San Francisco community and will be focusing over the coming weeks on helping employees through this transition and ensuring our current customer commitments are met.”

Omoomy did not return calls for comment.

No domestics please, this is San Francisco!: The closing did not come as a surprise to Mike Hollywood, a sales manager at the former Ellis Brooks Chevrolet at Bush and Van Ness, which got out of the American new car business 2 1/2 years ago.

“People in San Francisco just weren’t buying Cadillac Escalades. You can’t even park them in the parking structures here,” he said.

Neither, it seems, are they buying Ford Fusions in any quantity.

“It’s a tough market. Imports have a much bigger share in San Francisco,” said Dennis Fitzpatrick, owner of Concord Chevrolet and regional vice president of the California New Car Dealers Association. “When you can sell 100 imports a month as opposed to 25 domestic, and what with the rents and real estate, it’s tough to make a U.S. car dealership pencil.”

It’s a different story a few blocks down on Van Ness Avenue and on South Van Ness Avenue, where Audis, Scions, Hondas, VWs and Mazdas are on display. BMW and Mercedes-Benz are close by. Or hop on a 38-Geary bus, right by the Scion dealership on Van Ness Avenue, to get to the Toyota showroom on Geary Boulevard.

“San Francisco is not loyal to anything domestic; its allegiance is to anything but domestic,” Fitzpatrick said. (Oof!)

— The seven-story, 195,000-square-foot Ellis Brooks Chevrolet, by the way, is being transformed into a flagship Nissan/Infiniti dealership and “will represent one of the largest automobile retailing locations in the United States,” according to Nissan North America.

“We believe the facility will help us grow sales across the region and strengthen our competitive position relative to other automakers such as Honda and Toyota,” Paula Angelo, a Nissan spokeswoman, told me in March.

Too easy lay the head …: Google was getting used to wearing the crown as the world’s most valuable brand. That is, until Apple knocked it off.

The Cupertino company’s brand value jumped 84 percent to $153.3 billion, dropping Mountain View’s Google, which topped the list for the past four years, to No. 2, with a measly $111.5 billion (-2%), according to this year’s rankings from the WPP Group, a global advertising and marketing company.

“Successful iterations of existing products like the iPhone, creation of the tablet category with iPad, and anticipation of a broadened strategy making the brand a trifecta of cloud computing, software and innovative, well-designed devices,” was the stated judgment of the WPP’s sixth annual BrandZ Top 100 Most Valuable Global Brands.

Ten Bay Area companies made the list, with San Francisco’s Wells Fargo ranked 16th with an estimated brand value of $36.9 million, a 97 percent increase (what financial meltdown?). HP, at No. 18, dropped 11 percent to $35.4 billion, closely followed by San Francisco’s Visa and Redwood City’s Oracle.

The biggest percentage gainer (246 percent) is – surprise – Palo Alto’s Facebook, valued at $19.1 billion. Not bad for a company that’s yet to go public. Rounding out the Bay Area contingent this year are San Jose’s Cisco Systems, Santa Clara’s Intel and San Jose’s eBay.

Non-Bay Area items of note: Amazon.com beat Wal-Mart as the world’s leading retail brand. Twelve Chinese brands made the top 100, including the Chinese search engine Baidu, ranked No. 29, with a 141 percent increase in value, to $22.6 billion.

Oh, and Toyota reclaimed its crown as the world’s top car brand, demonstrating “the power of strong brands to recover from the most fundamental challenges to product efficacy and reputation” (sfg.ly/iMc8cV).

Blogging: www.sfgate.com/columns/ bottomline. Facebook page: sfg.ly/doACKM. Tweeting: @andrewsross. E-mail: bottomline@sfchronicle.com.

This article appeared on page D – 1 of the San Francisco Chronicle

Article source: http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2011/05/09/BUA31JDR5T.DTL