Bay Area Rents Hit Record High, And Oakland Has Risen The MostOctober 16, 2014
The average asking rent for an apartment in the Bay Area increased to a record $2,234 in the third quarter of 2014, up 3.5 percent over the past three months and 11.4 percent higher versus the same time last year. And the average Bay Area studio is now renting for $1,931 per month, according to RealFacts, up 12.5 percent over the past year.
While San Francisco remains the most expensive Bay Area market with an average asking rent of $3,400 per month, up 5.3 percent over the past three months and 9.8 percent higher versus the same time last year, the largest increase over the past year has occurred in Oakland where the average rent now measures $2,498 per month, up 3.2 percent over the past three months and 17.6 percent higher, year-over-year.
Average rents in Santa Clara and San Mateo have both risen 10.7 percent since the third quarter of 2013 and now average $2,369 and $2,580 per month, respectively.
Keep in mind that RealFacts statistics are based on a survey of institutional buildings with at least 50 units, buildings which tend to offer amenities beyond the walls of the apartments and are prime candidates for corporate rentals and tenants with relocation packages.
Comments from Plugged-In Readers
Worth noting that even in this environment, developers say that projects aren’t penciling out in Oakland (recent SF Business Times article, don’t have link).
Very good point Frank C.
Why aren’t they penciling out?
Umm… Developers are cry babies who don’t like to make money the old fashioned way: with a well run business offering a high quality product. So the cost to borrow money is at a all time low, there is apparently buckets of obey sloshing around the world looking for a good opportunity and we r in the midst of major demographic shift back to cities. But it doesn’t pencil out!!!!!????? But hey… Why compete when u can get the public to finance your project via billion dollar stadium deal.
$1931 for a studio!!! Not in Oakland
Construction costs are out-pacing the rents even with 17.6% in growth YoY. Investors lack belief in the market’s durability. Oh and yeah,one of the worst crime rates in the bay area…
The irony is that the crime rate remains relatively high due to a lack of public and private investment in the given area. Some of that is structural…due to a changing economy. Some of that is plain old discrimination… for example, red-lining by private an pubic entities. Some of that is due to factors that fall in the middle of the spectrum…such as prop 13 (keeping business property taxes too low makes it hard to fund the things help people and a region prosper). Anyway…all this is well known by anyone who cares to be honest about the situation. If you don’t know just pull an older family member aside and ask them to describe the state affairs when they growing up. Another irony is that crime is, in general going down, in major cities. And finally, why are construction costs so high? Presumably, construction technology and construction management info systems have been improving over time… and are producing major efficiency gains. So that can’t be the cause. It’s not due to labor; it’s well known that wages have been flat for approx. 30 years. Higher regulation perhaps? Maybe, but I don’t think the industry has too much difficulty winning public concessions that mitigate some of the costs arising from extra regulatory burden. Hmmm… what could it be?
Poverty causes crime? Yes, that’s why the old poor Chinatown in S.F. was once a hotbed of crime. NOT. And why crime increased during the Great Depression. NOT.
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