S.F. Rent Plummets 24% In Nation's Steepest Drop As Discounts, Giveaways Abound
San Francisco is still one of the nation’s priciest rental markets but its average rent has fallen more than 20% over the last year, the Zumper National Rent Report: January 2021 has found.
That drop is part of a larger trend of rental rates in major urban centers dropping after some remote workers sought more spacious accommodations in the suburbs. In October, Bisnow reported a distinct power shift between landlords and renters, as deep rental discounts and months of free rent used to entice prospective tenants became a common coronavirus pandemic theme.
According to Zumper’s data, the median price for a one-bedroom apartment in S.F. in January 2021 is $2,660, down from $3,500 just a year ago. That 24% drop also distinguishes the city as leading the nation in rental rate declines for one-bedroom apartments, tied with Santa Clara.
While rent losses were also sizable in other big coastal cities like New York and Seattle, Newark, New Jersey, saw a gain of 30.1%. The Midwestern cities of Cleveland and Detroit also saw huge gains, and the inland city of Austin, Texas, came in flat at 0% year-over-year change for both one- and two-bedrooms, similar to the overall national trend.
But in the Bay Area, Zumper’s report found nearly all cities in the nine-county metro area experienced rent declines.
With major tech companies shifting to remote work, the cities of Menlo Park, Mountain View, Redwood City, Santa Clara and Oakland saw rate shortfalls of over 20%. Like San Francisco, these cities all lie on major transit routes, including stations for BART and Caltrain. That decreased transit ridership has sparked concerns over the future of transit-oriented development for the region.
Some outliers were Milpitas, which showed both monthly and yearly gains, and South San Francisco. Known as “the birthplace of biotechnology," a moniker that’s been fueled by a steady increase in life sciences space, the city led the region in monthly rent gains with a 3.1% jump from December 2020 to January 2021.