Affordable Rentals Becoming Scarce In The Bay Area

SAN FRANCISCO (KCBS) – A new Harvard study has found that finding affordable places to rent here in the Bay Area and nationwide is becoming more and more difficult.

The report from the Harvard Joint Center for Housing Studies found that one in four renters spends more than half their income on housing, the highest level in a quarter century.

KCBS’ Anna Duckworth Reports:

And the latest data from MPF Research, which tracks the apartment sector’s latest statistics, found that San Jose had the highest rent increase nationwide from March 2010 to this March. San Francisco and Oakland also ranked in the top eight in the nation in terms of fastest growing rents.

Hessam Nadji with the Walnut Creek-based real estate investment firm Marcus and Millichap said the foreclosure crisis has a lot to do with it.

“We’ve had a lot of people displaced from home ownership that are coming back into the rental market,” Nadji said. “And the rental market in the past four or five years has not had too much new supply added. Therefore, the vacancies have dropped and the rental rates have begun to go up much faster than anyone anticipated.”

According to RealFacts, another organization that studies the apartment market, buildings with at least 50 units in the Bay Area saw rents jump on average 4.9 percent during the last quarter of 2010.

Nadji said things are especially bleak for low, moderate and middle income families.

“The new properties that are being built are usually at the higher end of the rent range because land and construction costs have gone up,” he said. “It’s more expensive to add new supply, therefore the rents have to be higher.”

Nadji said that this will eventually spur more renters to buy homes again once they’re convinced that market has bottomed out.

(© 2011 CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed.)


One Comment

  1. Jamilah Al-Rahman says:

    It took a Harvard study to figure out the prices in San Francisco were unaffordable??? I could have told them personally – we live in a shoe box, pay $975 a month in rent and we get the added bonus of people pooping and peeing on our door step! But for an added bonus we also are blessed with people smoking pot AND crack right under our window! Aren’t we blessed to have such a luxury apartment for the low low price of $975…………… ~grin~ This is mild compared to other neighborhoods, I really feel for them!

    1. Bryan says:

      You are paying $975 a month—a steal in the city!

      1. Jamilah Al-Rahman says:

        YOu haven’t seen my apartment. We can’t even fit a bed in there and the kitchen HARDLY fits one person.

    2. j says:

      You want to play, you gonna pay…

    3. Cheryl says:

      You clearly settled for less. Good deals are always to be found. You may consider an in-law rental in the outer Sunset. You just clearly didn’t shop around.

    4. Cheryl says:

      Here’s an example of a 3 bedroom one bath for $900 advertised today on Craigs list in a decent area. Don’t know what the condition is, but you could cram roommates in there and live or $400 a month incl utilities. easy. You just didn’t shop around, that’s all.

      $900 / 3br – 3BR/1BA Apartment – San Francisco (617 Howard Street, San Francisco CA 9410) (map)

      1. fred says:

        No way that’s a real ad. It’s some kind of scam. You can’t get a 3 BR anywhere in the city for $900. If you answer you’ll get a reply back saying something like “I recently had to move to Costa Rica, so I need to quickly sublet my apartment. Send me a cashier’s check and I’ll send you the keys.

      2. Cheryl says:

        I wanted to update this post. Those ads were a scam by someone in another country trying to get a money deposit wired to them.

  2. Pattiwacks says:

    I am contemplating retiring in Dallas Texas and moving back to San Francisco where I lived for over 20 years. Do you think I could afford to find a decent place with a monthly income of $2000 a month?

    1. Cheryl says:

      You’ll have to get roommates or find a cheap in-law in a distant suburb like the Outer Sunset or Richmond districts. You’ll end up with low income people in a bad area. They won’t lease to you unless your rent is approximately 1/3 your income. That means your projected safe rent for a lease is 660. That will buy dirt in SF.. You’ll probably have to rent a room and it won’t be nice unless you’re lucky enough to find a deal sharing with several people, up to 4 people. The more people, the more bedrooms required which will drive up the rental cost as well.

      If you don’t make good money, it’s not advisable to move to this city. You’ll run into problems living here, there’s a lot of criminal elements competing with your unstable situation.

    2. fred says:

      Absolutely not. The housing costs will eat you alive. You might be able to get a one room studio in the Tenderloin for under a thousand, but anywhere else is probably going to cost $1200 and up.

  3. Jim says:

    A link for the MPF study would be desirable, instead of a closed loop. Sheesh…

  4. betty says:

    I live in Ashbury Heights. I have a great apartment and pay $840.00, but I’ve been here 20 years. One bedroom apartments in my building for for $2500.00. The only reason I stay in SF, is because of my low rent. I know once I leave I could never afford to return.

    1. Cheryl says:

      Exactly, the people who have the deals have lived there several years. The age of low rent in San Francisco is quickly coming to an end and it will NEVER GO DOWN for decades to come. Why you might ask? Because the real estate market is finished. Homes will not in property values for at least a decade. It means the rental market will remain high from here on out. It’s not like it used to be where rent is high a few years, then a bubble bursts causing people to leave. Rent will always be high in San Francisco from here on out.

      1. Cheryl says:

        Correction: I meant property values won’t be rising for at least the next decade. I’ve spoken with people in the banking industry who are selling their properties and taking losses. Take heed, danger is up ahead. This is a new world headed our way.

  5. HooDatIS? says:

    thats why im going to pitch me a tent on the golden gate bridge and just live there smoke pot and beg for change during rush hour
    look how much i save by switiching to geico
    visit my blog

  6. victim says:

    This is the worse period ever.. people say +5%?? sorry we are talking about +25-30% increase since 5 months. The public numbers are completely wrong or that includes a lot of cities way far from SF/san jose. If you want to “lower” the monthly rate you have to sign a 12 months lease. No way we are currently at the top of the edge. In a few months the rent will decrease a little bit. Bad for you if you sign a 12 months contract now. This is a trap…

    1. Cheryl says:

      This is where the landlords take advantage due to all the rent control.

  7. 925 Owner says:

    I do not recommend anyone to wait to get into the owner market if the property and price are right. Now is a great time. Projected values may dip about another 5% before they go back up but I project an inlcine to begin in the next 5 years. Nothing drastic, but it will go up. I just bought a 3 bed condo in Contra Costa for under 100k. Mortgage/HOA/Taxes/Insurance are roughly 1.1k/month. The rent on this until is bout 1.5k/month.

    If I waited another year to see if the price goes lower I will have spent $18,000 in rent for the year only to save $5000 (5% of $100,000). Do the math.

  8. Not happy says:

    Higher rent means higher cost of living. employers will have to pay their employes more which means difficulties in the job market. The increased salaries will convince people to buy homes, and that will lower the rental market. These rental prices are obscene, and renters who think they are going to cash in right now, are setting themselves up for difficulties in the future.

    1. Cheryl says:

      The problem is that banks aren’t giving out purchase loans, it’s very difficult to get one for even the best credit history.

  9. whatsf says:

    Comment on the story, if you want to “chat” take it off line. No need to reprimand a poster about the apt they rented. Geez.

  10. cheapest phone says:

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