For rent: Shortage of units keeps apartment prices high
Rents in large Bay Area apartment complexes flattened out in the last quarter of 2013, according to a report Wednesday from RealFacts, continuing a slowing trend from the previous quarter.
The average rent for a Bay Area apartment in complexes with 50 or more units was $2,084 a month, up 10 percent from a year ago but almost unchanged from $2,080 in July-September quarter. Average Bay Area rent ranged from $1,728 for a studio apartment to $2,766 for a three-bedroom unit.
In Oakland the average rent was $2,133; in Concord $1,357; in San Jose $2,022; and in San Francisco $3,056.
The Bay Area’s burgeoning workforce has put pressure on both housing and rents, creating shortages and pushing prices beyond the reach of many people with good jobs but not high-paying tech jobs.
Renters complain of sharp rent increases and a shortage of vacancies that’s caused for long lines of would-be renters to form in front of studio apartments.
Sara Kidder, 38, of Oakland, said she and her roommate wanted to move to a newer place and began looking last year. They found 80 people waiting to view one studio apartment, their credit histories in hand.
“And a lot of the places were awful,” said Kidder, who runs an event coordinating business. They decided to stay in their current apartment, which, while small and costing $2,250 a month, is in a trendy area near Lake Merritt.
“Supply certainly is not going to outstrip the demand,” anytime soon, said Nick Grotjahn of RealFacts. “San Francisco is hiring like gangbusters, and that’s really the driving force here.”
Also, few new complexes have opened since the downturn, he said. The backlog is beginning to be addressed by developers “but it will take a couple of years before we see anything that’s going to slow rents down.”
People looking for apartments in the South Bay should “keep their running shoes and their checkbook by the door,” said Ron Stern of Bayrentals.com, which helps people find rental housing.
“The competition is pretty fierce,” he said. “If you’re number five in line you’re too late.”
Veronica Ramos, who directs a migrant worker project for the Santa Clara County School District, was shocked at the rents when she relocated to the South Bay from Stockton. She moved in with her parents in Campbell. This week, she finally landed a studio apartment in Campbell for $1,800 a month, with a hefty deposit. “How do you afford a studio apartment and save money for a house?’ she asked.
While Ramos looked for a place to rent, she saw “entire families looking for a one-bedroom apartment.”
Elisa Fischer-Somit, a legal secretary, and her husband, Jacob, of Lafayete, were hit with sticker shock when they started looking for a bigger place recently. Not only had prices jumped 30-40 percent in the 18 months they’d lived in their one-bedroom, but there weren’t that many available.
“Now we’re looking at a different option, maybe buying a condo instead. We’re thinking that maybe a mortgage may not be that much more than paying rent. Buy again, we’ve noticed it seems like not a whole lot of people are selling,” she said.
Buying may mean moving farther east in Contra Costa County, lengthening her commute to Oakland.
“It’s been very stressful for us. My husband grew up in Concord. We both want to stay and not have to move way far away to get the size house we want,” she said.
Some renters are thinking about leaving the Bay Area for some place more affordable.
Stephanie King, 33, and her two children, have been living with her parents in Pleasanton while shopping for an apartment there. She’s gradually coming to the realization that she may not be able to afford one in that pricey community.
“Modesto and Stockton are looking better and better,” she said. “I went to an open house this past Saturday. It was a 700-square-foot, two bedroom for $1,100 a month. It was super tiny. There had to be at least 50 people there at the time I was there, and they were still coming when I left. Central Valley, here I come.
By: Pete Carey Bay Area News Group Thursday, January 16, 2014