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.
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