Name: S.F. renters gain rare leverage in pandemic, with vacancies way up and prices way down
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S.F. renters gain rare leverage in pandemic, with vacancies way up and prices way down

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Apartment vacancy rates have more than doubled since last year in the San Francisco rental market, as many during the coronavirus pandemic.Not only do renters suddenly have more options, but the spike in supply has and put them in a rare position of power in the historically competitive market, analysts say.“For the first time in a long time, they hold some leverage in the market,” said Rob Warnock, a research associate at listings service Apartment List. “With more options to choose from, they can be more selective and they have more opportunities to negotiate their rent payments, knowing landlords have a greater-than-usual number of vacancies to fill.”The housing crisis in San Francisco has been relentless. In January, the completed this year including luxury condos, student housing, senior homes and subsidized family complexes. To meet demand, Mayor London Breed said more than twice that many units would need to be built every year.But analysts say the pandemic has prompted an out-migration among renters, giving those who remain some relief: While San Francisco rents are still the highest in the nation, they’re down 20.7% year-over-year with the average price of a one-bedroom in October at $2,800, according to listings website Zumper.“This speaks to the inverse relationship between supply and price: as more homes are made available, prices drop in an attempt to attract new renters,” said Warnock. “This is why housing advocates argue for new home construction as a solution to the affordability crisis.”Analysts from Apartment List and Zumper calculated their vacancy and availability figures from data on their own websites, which differ from through its data collectors.Apartment List looked at the percentage of San Francisco apartments listed on its website that are vacant at any point in the month. It pulled from a large sample of more than 25,000 units, and calculated the vacancy rates using a consistent set of listings for January through October, so the vacancy rate isn't affected by units joining or leaving the site.The vacancy rate was 4.9% in March, then climbed each month until hitting a peak of 11.7% in August and September. In October, the rate was still high but decreased to 10.3%. Compare that to 2019, when the vacancy rate was much more steady throughout the year, hovering from 3.8% to 4.4%.One caveat is that the sample tends to skew toward newer multi-family rentals, so more affordable housing and older or single-family homes may not be as significantly represented in this data.Zumper also tracked a recent huge jump from last year in rental availability in San Francisco via its listing count — a figure that differs from the vacancy rate by representing the monthly number of active listings on its website.Most months in 2018 and 2019 show single-digit percentage availability increases compared to the previous year with the occasional double-digit growth. Beginning in August 2019, the year-over-year availability declined each month until Feb. 1, 2020 — just as the pandemic was taking hold.Starting in March, year-over-year availability percentage growth reached the double digits. It continued to rise, hitting triple digits on July 1, with an increase of 131% over the same time last year. It reached its highest year-over-year increase at 227% on Sept. 1, before declining to 199% on Oct. 1.“Price and rental availability trends in San Francisco can largely be explained by a net migration outflow of renters that started in the early post-pandemic months of 2020,” said Neil Gerstein, Zumper analyst. “As more renters leave San Francisco than there are new ones coming in, rental vacancies increase while prices decrease.”Updated to include drought zones while tracking water shortage status of your area, plus reservoir levels and a list of restrictions for the Bay Area’s largest water districts.Zumper analyzes rental data from more than 1 million active listings across the country. It includes new construction and excludes listings that are currently occupied or no longer available.How long renters will enjoy some breathing room remains to be seen.Warnock said he believes availability will likely remain high through the winter and into the spring, or until San Francisco lures renters back to the city again.“Typically San Francisco gets a big wave of new residents each summer, but this year the combination of a weak labor market, the widespread adoption of remote work, and persistently high rents (despite recent drops) means that many renters elected not to move here,” he said. “By that logic...I also expect rents will continue to stay low throughout this period.”Vacancies are still high and rental prices are still decreasing, but that could change in the near future.“Price decreases are lower than before, and the migration inflow to the city is trending upwards,” said Gerstein. “These signs are an indication that rental price and vacancy stabilization in San Francisco could occur in a few months, but it is too early to tell at this point.”More for youKellie Hwang is a San Francisco Chronicle staff writer. Email: Twitter:Updated to include drought zones while tracking water shortage status of your area, plus reservoir levels and a list of restrictions for the Bay Area’s largest water districts.

Apartment vacancy rates have more than doubled since last year in the San Francisco rental market, as many during the coronavirus pandemic.Not only do renters suddenly have more options, but the spike in supply has and put them in a rare position of power in the historically competitive market, analysts say.“For the first time in a long time, they hold some leverage in the market,” said Rob Warnock, a research associate at listings service Apartment List. “With more options to choose from, they can be more selective and they have more opportunities to negotiate their rent payments, knowing...

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Kellie Hwang

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S.F. renters gain rare leverage in pandemic, with vacancies way up and prices way down

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