With the average asking rent for a one-bedroom apartment in San Francisco having dropped 23 percent over the past year to under $2,700 a month and the average asking rent for a studio having dropped even more, the weighted average asking rent for an apartment in the city, which currently measures around 2.3 bedrooms when counting a studio as having one, has dropped to $3,100 a month.

While $3,100 a month in rent certainly isn’t “cheap,” it’s now $1,000 a month or 24 percent cheaper than in January of this year and nearly 31 percent below a 2015-era peak of closer to $4,500 a month.

And despite the precipitous drop in rents, resultant pro forma cash flows for investment properties and inputs for rent versus buy calculations, there are still over three times as many apartments currently listed for rent in San Francisco than there were at the same time last year with an overall vacancy rate that’s ticked up to around 10 percent.

Comments from Plugged-In Readers

  1. Posted by ST

    I definitely feel lucky that all my 4 units are rented now, 3 of which are turned over this year, at $100~$300 higher than what the previous tenants were paying…..Property prices, however, have not fully reflected the reduced rents, and they will catch up (or down) in 2021, IMO……

    • Posted by John T. Nester

      Nice to see that you were able to gouge the new tenants during this period of pandemic.

      • Posted by Sierrajeff

        Nice for you to assume that his prices are gouging – perhaps due to draconian rent control ordinances his prior tenants’ rents were way below market. In any event, whoever moved in was apparently willing to pay what he charged – despite a softening market – so who are you to malign him?

        • Posted by Screwed landlord

          Hats off to you. I have Multiple tenants paying 600 for one bedroom for the last 25 years! Renters don’t see that. Rent control sucks! Get market rate any way you can!!

          • Posted by Stop Spreading Your Stupid Disinformation

            Good god, man! You can raise the rent every year, so if you haven’t done that, it’s all on you.

            If $600 a month was enough to cover your mortgage payments and maintenance and repairs (which it should’ve been, if you charged the correct rent at the start), then all those rent increases should also cover your expenses.

            Whiny landlords are the worst, especially if they apparently don’t know the laws about rent increases, and then they go online to complain about ‘draconian’ rent control laws.

          • Posted by Start negotiating your rent, even in rent-controlled areas.

            I lived in SF for 17 years in rent-controlled apartments. I then moved to NYC where there is no rent control, and my yearly increases in NYC are LESS than what they were in SF! Every year the landlord would raise the rent the maximum amount under law, and there was zero negotiations allowed (I also think a lot of people think, “Well, this is so much better than being in a market-rate apartment, so I should count myself lucky.”)

            In NYC, everyone negotiates (or, if you don’t you’re just new or naive), i.e., it is just part of the culture. I don’t know if this would really help in SF, but I am much happier being in NYC with my current rental situation than I ever was in SF.

        • Posted by Phil100a

          Yes, he owns those units and he can do what he wants with them. That said, never forget that landlords create NOTHING. all they do is use their capital to take advantage of artificially low supplies of housing and make every penny they can off the sweat and blood of their tenants. There are some exceptions to this but they are relatively few and far between. I am so sick and tired of hearing landlords whining about how difficult things are…

          • Posted by Petrov

            Similarly one can argue that stock market investors also don’t create anything. The next step would be claim that anyone who lends capital in the exchange for interest creates nothing. But then one does one get a loan to buy a car or go to college or buy a house? Landlords are no different from anyone making their income from capital. If not for them there would not be any ability for newcomers to come to a city without buying a house, which not an option for most of the people, so jobs cannot be filled and opportunities are not realized.

          • Posted by ST

            Why do you let a landlord suck “sweat and blood” out of you? Are you not capable of making good business decisions for yourself?

          • Posted by Cave Dweller

            Landlords assume risk on your behalf. As a renter you get to live in a place paid for by someone else without the risk of investing or taking on capital deficit. By assuming risk on your behalf, they also act as conduits to inject liquidity into market while taking a fee for their risk and service.

          • Posted by VI Lenin

            “Similarly one can argue that stock market investors also don’t create anything. The next step would be claim that anyone who lends capital in the exchange for interest creates nothing”

            This is correct, comrade. Value is created by labor. Rent-seekers do not create wealth, they simply hoard the surplus value that was created by the labor of their workers. They are allowed to do this because of their monopoly over the means of production. This hoarding of capital that was first created by the workforce (or what you would refer to as capital accumulation) is the method in which they then “lend” that capital back to the workforce from whom they originally pilfered.

      • Posted by haighter

        Right… those tenants were all forced to take those leases at the rates offered… especially in an environment when they most likely could’ve moved out of SF while working remotely and there are plenty of other apartments available for rent.

      • Posted by Paul

        I’ve owned 2 rental properties over 10 years and every small rent increase really just decreases my negative cash flow. It’s simply untrue that the majority of small landlords can go without rent from their tenants. The landlords need to pay the mortgages to the banks each and every month.

        • Posted by Rent-O-Matic

          That mortage is building up *your* capital. You can definitely live without it.

          • Posted by ST

            If you think about it, anyone staying less than 10 years is NOT getting real benefits of rent controls. One needs to stay 20+ years to get meaningful benefits. So, % wise, how many of us get to stay at a place for 20+ years, especially when the place is severely outdated?

            As a result, I feel that rent control laws in SF generates more social attention and divide than actual “protections” for the tenants IMO.

  2. Posted by Cave Dweller

    @ST — how are you doing in cash flow terms (rent earned vs mortgage paid + expense)? positive/negative? in either case what is the difference?

    • Posted by ST

      Mine won’t be good benchmarks, as they were all purchased on short sale or foreclosure, in 2009, 2012 and 2015. and yes these are 2/2 in Pac Height or 2/1 in Russian Hill. Numbers wise, $180K in gross rent, $50K in property tax and HOA, $65K in mortgage interest. I know I pay down $70K in mortgage principal each year which is more than the required amortization…

  3. Posted by redseca2

    After living in San Francisco for over 40 year, just seeing a “For Rent” sign like that on a building is weird enough.

    • Posted by Pablito

      Absolutely agreed. I can’t recall ever seeing a for rent sign on a nice looking place like that in the City.

      There are a lot of crappy places to rent in SF, and they turn over often enough. But nice places for rent? Usually you have to be a second cousin of Mark Hopkins and have reference letters from both Emperor Norton and Herb Caen.

      Maybe this time is different.

  4. Posted by Jeffrey W. Baker

    If it comes down another 15% then that typical apartment will be affordable on a typical SF household income.

    • Posted by Carolyn Zaremba

      Right. Paying more than a thousand dollars for a studio is robbery, pure and simple.

      • Posted by justin smith

        Then don’t pay. Plenty of jobs and places to live elsewhere. No one is forcing anyone to live or work in San Fransisco. It’s a hell hole. I’d have to make $220,374 to live as well I do if I moved to San Fransisco according to Nerd Wallet.

  5. Posted by Neighborhood Character

    For better or worse, because of the eviction moratorium, a lot of rental inventory is locked out of the market. I wonder what will happen once there is a lot more liquidity.

    At what point will the price-to-rent ratio start pressuring home prices downward. Right now prices seem mostly flat, but again it’s difficult to say without a properly functioning market.

    • Posted by civ-e

      when will the eviction moratorium end? it’s pretty safe to say that most tenants who have received free rent for such a long duration are going to strategically choose to just bail instead of cough up back rent.

      • Posted by Sierrajeff

        But I think that’s the point – when the eviction moratorium ends, in theory a lot of units will hit the market – some due to evictions, and some from tenants decamping to avoid back rent. Either way, a potentially large number of units.

        • Posted by civ-e

          oh yes, it wasn’t too clear but i was agreeing with OP’s point, but was just wondering when the moratorium will end.

          • Posted by truth

            If the Republicans hold onto the Senate, eviction moratoriums will end on Jan. 20 @ 12:01 pm, in the name of “national debt” of course

          • Posted by St

            It does not matter when the moratorium ends… the court is so backed up that tenants will most likely able to live rent free until end of 2021…. then they can pack and go, to avoid back rent or having a eviction record

          • Posted by haighter

            Hold on – is “St” saying that a non-rent-paying tenant who leaves the apartment before the end of the eviction moratorium has no eviction on his/her record? If that’s true, why am I (or anyone else) paying rent on time?

          • Posted by ST

            haighter – I am pretty sure that until court orders an eviction, there is NO eviction record. So a tenant can stay long after the moratorium ends, and as long as he leaves before the count hearing, he will be fine.

          • Posted by haighter

            Thanks St. Makes sense. Just a delay in the courts, assuming landlords will bother with the process. I was worried you meant an eviction for non-payment “due to covid” didn’t count as an eviction on the renter’s record.

  6. Posted by Ann Hitt

    So what! Its still way too high!

  7. Posted by Wal

    We hope that it goes down to 1988 levels.

    • Posted by ST

      For rent to drop back to 1988 levels, a lot more people will have to be jobless, and a lot more people will have to go bankrupt, probably including yourself…..Is THAT that you are hoping for?

      Alternatively, instead of hoping for rent to drop, how about think about how to improve your earning power?

      • Posted by John T. Nester

        Typical pull-yourself-up-by-your-bootstraps mentality! I thought that went out around the same time Ayn Rand exited the scene?

      • Posted by AJ

        For rents to drop even more, more people do not have to be homeless, jobless or bankrupt. Your argument does not make sense. There just has to be less demand. More companies will go fully remote post-covid, and people can avoid living in dirty SF that does not take care of it’s homeless.

        • Posted by Freeloader

          It would require a pretty huge shift for rents to drop 70%… probably a lot of bankruptcies, much worse than the Great Recession.

          • Posted by Brahma (incensed renter)

            bankruptcies filed by whom? Globalist, remote landlords who read somewhere on the web that S.F. has a workforce that has been bludgeoned into thinking that it’s usual to pay north of 40% of a tenant’s income toward rent and therefore it’s a good residential real estate market to invest in? I don’t think those people are going to go bankrupt, they have more money than they know what to do with and many of them are just trying to squirrel their money out of their home countries.

            Maybe a minority of already local, penny ante landlords who have a job and lease out property as passive income and happen to be overleveraged, they might have to file for a Chapter 13, but so what. The only people that lose out in that scenario are the lenders.

            AJ is probably correct, if we have a mini exodus with a bit more duration than what happened after the dot com implosion, rents will drop dramatically and the landlords who don’t have the stomach to face that will just sell their properties to other landlords who are sufficiently capitalized.

        • Posted by ST

          if more companies go full/permanent remote post covid, that will surely translate into higher unemployment for SF. And between the wealthy and the working class, we all know who hurts more in an economical downturn. So instead of hoping for the entire economy to tank just so you can get lower rent, try the pull-yourself-up-by-your-bootstraps method suggested above.

  8. Posted by Brian M

    1988 levels? Why not hope for Detroit levels of abandonment and despair?

    • Posted by curt mayer

      That would be an improvement. We’d be a magnet for artists and fringe people, like sf was 50 years ago. Yuppies can f*ck right off, they culturally bring only cash.

  9. Posted by tfourier

    Well as the annual inflation rate for my benchmark rental property in SF (houses in the Sunset) has been just over 4% since the mid 1980’s and the last reversion to mean was 2009/2011 a quick looks at the calculator show that the slump this year has rentals reaching reversion to mean values in the next three months.

    Already the clearing price (rentals price for properties that are rented immediately) is around the mean value. I expect an overshoot (under) like the early ’90’s this time around as this will be such a brutal recession. So still quite a while before it hits bottom. Could be another 12 months at least.

    For reference, the ratio of the minimum wage to my reference rental proper has stayed about the same in the last 30 plus years. So just as affordable (unaffordably) now as it was back in the 1980’s. San Francisco has not had relatively affordable rental prices since the 1960’s. When compared to typical household incomes. Which was about the time the anti-growth / no growth politics first got started in the City. Cause and effect.

    • Posted by Ohlone Californio

      San Francisco had very affordable rental prices in the early to mid 90s, actually. Massive 2-4 bedroom plus double parlor type flats could be had for well under 2K in multiple vibrant areas.

      • Posted by tfourier

        I remember looking at a bunch of really nice two bedroom apartments in Cole Valley / Ashbury Heights for $1200/$1250 in the early 90’s. Very big, great views.

        In the end went for a nice 3 bedroom house on GG Heights for the same price. Great landlord. It rented out in 2000 for $3100 but a decade later a nicer house down the hill was $2200.

        Clearing price for this kind of house is currently $3300 ($4000 two years ago) but expect it back below $3000 fairly soon. Which it was in 2014. I could easily see the low as $2700 or lower. 2012 prices.

        • Posted by Ohlone Californio

          I had a massive, like 1800 sq ft flat in Lower Haight that I rented in late 1995 for $1700.

          • Posted by tfourier

            The problem with the Lower Haight back then was it was kind of dangerous. At least east of Fillmore, around Haight st. Until the projects were rebuilt and the (few) troublemakers were shipped out to places like Vallejo. I had a friend who had a huge place in Hayes Valley, I think it was about $600, in the early 90’s. The area was so dangerous I had to walk her to the front gate, day or night, after dropping her off. Watching the street with my back to her while she opened the very heavy iron gate to get at the front door. This was when drive-by’s were a regular occurrence around those blocks. I also knew some people with a huge place at 12’th and Folsom who paid not that much more. It was such a dangerous area we rarely visited.

            So not always the good old days,

          • Posted by Ohlone Californio

            I never found it scary in the least, though I did see a guy who had been shot stumble into Volare pizza one time. Regardless, the transition of subsidized housing units from the old fortress like central courtyard model to townhouses was a great thing for both residents and neighbors.

        • Posted by Kevin OBrien

          Where can you rent a 3 bedroom for $3300 in GG Heights?

          • Posted by tfourier

            The $3300 clearing price number was typical Outer Sunset / Parkside 2 bed plus extra room downstairs number. $3000 with in-law downstairs. The houses that were built in late 1930’s late 1940’s. Add about 10% for up the hill. A really nice place turned around in few days for around that not that long ago on GG Heights.

            And as usually lots of people asking for 20% plus over clearing price and as a result remain remain unrented for months. It was exactly the same thirty years ago. Plus add 10% for rentals through management companies. I never deal with them. Always trouble. I see places at clearing price rent immediately and places that are 15% / 20% over remain on the market for many months. This is on craigslist. Which took over from the SF Chron/Exam classified as where all the good deals are about 1997.

          • Posted by jimbo

            my friends just rented a 3bdr/ 2bath in Lake street district on 12thAve, 1/2 block from the presidio for $3100 (with parking). I couldnt believe they got this price. They were recently paying $2950 for a 1bdroom near the Fillmore. there are some deals out there. 3br, 2ba condos near there are still above $2M, albeit nicer

      • Posted by Todd Van Fleet

        Exactly. Those were the days. I was a bartender (Balboa Cade fun, great money ), touring and local musician, living in Nob Hill (Keystone Apts) 2 years. 3 bedroom , 2 huge living rooms, $1,400 per/mo (Won my case against -awarded $15,000). Russian Hill another 2 years with 1 room mate 500$ per/mo. Vacation in Mexico, Vancouver, go on tour, music school and still decent 401k and savings.

        This city still had it’s heart and soul. Soon to be dehydrated by the tech locusts. Still the best town ever.

  10. Posted by Chad

    Honestly, I’m happy to see rents drop to a level that isn’t completely obscene for what people are getting.

    I’m back there for a week each year to visit friends, and the label of homelessness is just absurd, even for someone like myself, born and raised in Vancouver (Canada). I don’t see any way in which housing costs aren’t related.

    [Editor’s Note: San Francisco’s Homeless Crisis is Homegrown and a Catch-22]

    • Posted by jimbo

      there are 5000+ drug addicts on the streets. lower rents are not going to help them get off heroin/fentanyl and into housing

      • Posted by two beers

        With lower rent, fewer people will wind up on the streets, and it will give those in recovery a chance to recover off the streets in places they can afford at the low wages they will likely earn in the jobs available to those in recovery.

        You know, “pull themselves up by their bootstraps,” as certain types of people like to say. You can’t realistically pull yourself up by your bootstraps if the only jobs providing incomes sufficient to afford local housing require the ability to program apps no one will ever use, upper middle class “skills” not readily available to those we would like to see “get off heroin/fentanyl and into housing.”

        Class war never sleeps.

        • Posted by jimbo

          yes, maybe it will stop the increase of people ending up homeless in the future (which is no doubt a good thing), but wont do much for those in active addiction currently on the street. we need to greatly increase recovery programs and mandate some of the severely sick to treatment

        • Posted by Obrien

          Plain false. The heroin addicts from SF come here from other parts of the state and country because they know there will be no consequences for their lifestyle here. middle class families pushed out of rent controlled apartments don’t just go homeless. They move to the east bay.

          • Posted by tfourier

            The survey quoted is a one of those misleading activist “surveys” which asks questions that will get the desired answers for their political purposes.

            All substantive surveys I have seen published in SF since the 1980’s show exactly the same kind of numbers. Numbers reflected in every story I have heard personally over the decades. Around 50% of street people have only recently arrived in SF. Less than six months. They have no long term residency history in SF. No local family connections. Another 25%/30% of street people have a longer association with SF, often causal living arrangement, in and out of shelters, SRO, etc, but have no meaningful long term residency in the City. > 3/5 years, or extended periods of employment. Only a tentative connection with the City. So at any given time maybe 20% of street people have any kind of real connection with San Francisco or the Bay Area. Through residency, work, or family history. This group tends to be disproportionately mentally ill or alcoholics when compared with the general street people population,

            Very few street people ending up on the streets are long term residents who lost their home. They are very easy to spot because they are so different from the run of the mill street people. They are never on the streets too long because every story I’ve heard is someone losing their rent controlled apartment of many decades and no longer able to pay market rate and refusing to accept that they will have to move back to wherever they originally came from. Which they do eventually. Almost never SF natives.

            So all the junkies on the streets, the recent influx, almost all out of towners and recent arrivals. Mostly courtesy of Prop 57 making mandatory rehab no longer a condition of probation. That equation has changed little over the years, the junkies are mostly out of towners and the alcoholics are mostly locals. Which is why I am always a lot more sympathetic towards the alcoholics. Almost always nice people and never sketchy like the street junkies. So will usually stop for a kind word and offer of a meal if opportunity arises. The street junkies on the other hand either should be back on mandatory rehab or back in jail. Where a lot of them came from. And belong.

            The mentally ill are the real heart breakers. Only a fundamental change of state law can help those poor people. Thats the real scandal, state law allowing seriously mentally ill people to refuse treatment that will keep them off the streets.

          • Posted by SocketSite

            The HUD-mandated Homeless Count Report is conducted by the City of San Francisco’s Department of Homelessness and Supportive Housing and is based on “a visual assessment of people living unsheltered in San Francisco, a census of all shelter and transitional housing programs, and a survey of people experiencing homelessness.”

            At the same time, most of the stories people “have heard personally” and passed around “over the decades,” or were printed in the press as human interest stories, are based on perceptions or anecdotes versus comprehensive survey results.

          • Posted by KOBking

            That “data” is based on unverified self-reporting by the homeless. Such surveys are notoriously self-serving and unscientific. Try visiting the “homeless” subreddit and you will see daily examples of homeless people around the country discussing coming to SF.

          • Posted by SocketSite

            While surveys are inherently flawed, a structured sampling of over 1,000 people, representing roughly 13 percent of the population, is significantly more scientific and representative of the homeless population than the “daily examples of discussions” posted in a subreddit thread.

            In addition, the consistency across the surveys either suggests more than a modicum of accuracy or a herculean effort amongst the homeless population to coordinate their survey responses every two years.

          • Posted by KOBking

            The consistency of the survey could also suggest that homeless misrepresentations are made at consistent rates year to year.

          • Posted by jimbo

            while the survey is the best that we have, the methodology is severely flawed. I saw an article on this once, and there were homeless who stated they were encouraged to say they were from here. cant find it now. and a survey taken by an industry whose employee headcount and funding is provided by this is inherently flawed. still the survey stated 30% were from outside SF. even a reduction in the 30% coming here would make a big dent, but my guess is its significantly higher, especially among younger addicts. why stay in san mateo and contra costa (or completely out of area) where you might get arrested, when you can get unlimited low costs drugs in SF with no fear of arrest

          • Posted by SFRealist

            The data was garbage then, garbage now. But that won’t stop anyone from citing it.

          • Posted by tfourier

            I’ve been reading the street people surveys, substantive ones, since the 1980’s. They were never “human interest” stories, they were always City News Stories. They would have been published in the Chron and Examiner back when both papers have a newsroom full of great beat reporters. Almost all gone by 2006. Plus if I am not mistaken there has been a least one or two Civil Grand Jury reports on the subject over the decades. Again reported on in detail of the papers of the days.

            If you want to get an idea of just how good those reporters were back then a lot of them wrote for periodicals like the California Journal which back in the 1970’s to 1990’s published exceptionally high quality articles on local politics. Reading those old articles now shows just how much we have lost. Even the Sac Bee has given up the fight.

            What I have learned is that every single report from any group or organization that has “Homeless” in its title when you track down and read the report you will find the most glaring errors in their methodology and numbers. Always little more than some undergrad social studies survey level of material. So worthless.

            The numbers I read in those reports back in the 1980’s and 1990’s were reflected by what I saw on the streets at the time. A lot of the people I see on the streets now are very different from those of 10 or 15 years ago but remarkably like those you would have seen on the streets 25 or 30 years ago. I now see a lot of people just like those who were taken off the streets in mid to late 90’s by Three Strikes have now arrived back on the streets again courtesy of Prop 47 and Prop 57. So I see absolutely no reason to believe that the sort of people who are currently on the streets, or how they arrived there, is any different from 25 or 30 years ago. The dynamics of how people end up on the streets has been remarkably constant since most SRO’s were demolished back in the 1960’s and 1970’s

            If you have lived in SF long enough you would have seen it all before. Which we have.

  11. Posted by Lee Doolan

    “…the weighted average asking rent for an apartment in the city, which currently measures around 2.3 bedrooms when counting a studio as having one…”

    Sure, count a studio as having a bedroom. How to lie with statistics.

    • Posted by SocketSite

      Keep in mind that our accounting for studios doesn’t impact any of the pricing stats or trends above, it only changes the number of beds one would expect the average-sized apartment listed for rent in San Francisco to accommodate.

    • Posted by KOBking

      It isn’t a lie if they are up front with the accounting.

  12. Posted by Eve

    Happy to see the techies up and went. Hopefully we will have my beloved San Francisco back. When this pandemic is over, this city will be bustling again. SF is considered one of the most breathtaking city in the world.

    • Posted by DK

      Pinning the blame solely on techies is a facile scapegoat that people latch onto instead of thinking about zoning, regulations, and politics. Not one mention of the existing homeowners who are all too happy to maintain artificial scarcity and gouge people having to live on location until just recently.

  13. Posted by Jonathan major

    Is there data on rental prices for single-family homes, in San Francisco?

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