Bay Area rents are falling, falling, falling

The message is becoming increasingly clear: Rents indeed are falling around the Bay Area.

New data from the Axiometrics research firm show rents dropping in San Jose, San Francisco and Oakland. The Oakland piece is a new twist; according to other surveys, Oakland rents have remained on the rise, though at a far slower rate than over the past year or two.

Here’s what Axiometrics has to say about average rents falling into “negative-rent-growth territory”:

  • In September 2016, San Jose rents fell year over year by 3.4 percent from $2,814 in September 2015 to $2,718.
  • During the same time period, San Francisco rents fell year over year by 3.3 percent from $3,336 to $3,226.
  • And Oakland rents fell year over year by 0.6 percent from $2,392 to $2,378.

There were slight month-over-month declines between August and September 2016, as well: Rents dropped from $2,800 to $2,718 in San Jose (off 2.9 percent); from $3,301 to $3,226 in San Francisco (off 2.3 percent); and from $2,413 to $2,378 in Oakland (down 1.5 percent).

Now compare our region’s scenario to the nation’s: The average national rent stood at just $1,290 in September 2016, up year over year by 2.6 percent from $1,258, according to Axiometrics.

The Axiometrics study follows one by Abodo, the apartment search website. It showed rents dropping 7 percent between September and October in San Jose (from $2,455 to $2,293) for a one-bedroom apartment, and falling 6 percent in San Francisco (from $3,698 to $3,483). However, it showed rents still climbing in Oakland — by 5 percent, from $2,256 to $2,358 for a one-bedroom.

According to a third-quarter report by Novato-based RealFacts, the average San Jose apartment now rents for $2,500, up 0.6 percent from the third quarter of 2015, while the average San Francisco rent fell year over year by 3.4 percent to $3,499. In Oakland, the average rent is $2,927, according to RealFacts — up 2.8 percent on a year-over-year basis.

One last thought: Even though the runaway market is finally starting to cool off, most middle class folks still struggle to afford an apartment here.

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Photo at top: A new crane rises up in downtown San Jose on May 18, 2015 for a seven-story apartment complex under construction at 51 N. 6th Street. (Karl Mondon/Bay Area News Group)

 

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  • Louise A.

    Are these asking rents (for units on the market), or average rents (what current renters are paying)? Both are important measures, but they’re very different.

 
 
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