Average rental rates continue to climb at pretty much the same rate as they have since 2011. The market appears to be willing to pay more at a time when the availability of apartments is increasing. Now, remember these are asking prices as listed by Craigslist.org. The actual price paid may be less. There must be some living spaces that are rented without any advertising. Please remember if you would like to use these graphs please get the written approval from both Craigslist.org and Missionlocal.org.
As you can see, the rental rates continue to rise. Plots for the larger number of rooms have a great deal of variability as the sample size is small. The rental rates began to climb just after the financial meltdown in 2009. The demand was low and unfortunately there was no building of any kind in the city. The 2009 construction stall is one of the key dynamics, which I believe brought us today’s housing shortage.
There was an abundance of available apartments in 2009. The nation and San Francisco’s economy was at a stand still and financing was impossible. Gradually the economy picked up and people began returning to the city, resulting in a decline in availability until the middle of 2011. The meager availability continued until some of the new construction has begun to come online. From that point on to today availability of apartments on Craigslist.org are increasing.
As you know this is my favorite graph. It lists every individual apartment available at sample time for the past couple years. The distribution of asking rents is shown. The “clumps” of dots indicate the bedroom configuration. The first group plots studios. Then one-bedroom listings are plotted and so on.
I’m guessing that when availability hits some yet unknown spot we will see a bifurcation of rate clusters. One being those apartments that are new and reflect current building and financing costs and all the rest. The new construction economics are most probably based on rental income projected to reflect the current level and excellent occupancy rates.
The banks are relying on the developers generating that kind of a revenue stream. The other properties are influenced by code compliance like AB094 and the general higher cost of maintenance of older buildings. Now for your part. What do you see? How about the future? All decent remarks are encouraged.
Remember, Mission Local’s commentary policy requests that you limit your comments and counter-comments. We want to avoid “ping-pong” commentary that has a tendency to bury great thoughts in a rhetorical discussion. All of the comments in this posting and my colorful charts are a reflection of my personal thoughts and in no way reflect the thinking of Craigslist.org or the editorial position of Mission Local. It’s just me, a self-assigned number fiend, thinking.