Rentals stay on the market longer, meaning landlords are more willing to deal.

Sabrina Belara, a full-time special education teacher at Downtown High School in Potrero Hill, says it’s crucial to live in the city where you teach.

After she was abruptly evicted from her sublease in the South of Market Area last September, she took advantage of the softer rental market in San Francisco and found an attic unit in a Mission District home for $1,800 a month.

News stories abound on San Francisco’s vacancies and plummeting rents: The vacancy rate for the approximately 3,000 property owners of the San Francisco Apartment Association is 27 percent, according to Janan New, the nonprofit organization’s director.

Rental prices are down 22.6 percent for a one-bedroom, according to Zumper’s year-end review. 

Shazam! To some, after years of ever-increasing rents, San Francisco appears to be a renter’s market. But, alas, for many working-class residents and middle-class professionals, rent in San Francisco remains steep, if not unaffordable. 

Belara, for example, works two side gigs, as a cooking teacher and a caterer, to pay for her $1,800-a-month attic. Moreover, rent consumes half of her income.

“To use the term ‘renter’s market’ right now is still speaking to a housing market inflated by gentrification, the tax breaks tech companies have been given by our city and the opportunities and mobility gentrifiers have,” Belara said. 

Even though renters report being able to negotiate small reductions, like Belara, many tenants said they’re still paying more than the 30 percent that is generally considered a wise limit. 

Each week, the San Francisco Housing Rights Committee takes hundreds of calls from tenants unable to pay rent because of the pandemic, said Sarah “Fred” Sherburn-Zimmer, the housing group’s executive director.

But many have negotiated with their landlords or property managers to reduce existing rents or rental listing prices, according to Sherburn-Zimmer as well as more than a dozen landlords, property managers and renters interviewed. 

“Even though rent prices have fallen, it’s still insane … it’s just not quite as absolutely bonkers.”

Corey Browning

Josh Carter, a veteran, photojournalism student and part-time mental health clinic worker living in the Inner Richmond, asked his landlord for a $700 discount when his neighbor moved out. They bargained a $150 reduction, bringing his monthly rent for a two-bedroom apartment to $3,500. 

Ayran Michaels, a full-time technician at Mike’s Bikes in SoMA, sent his landlords evidence that vacancies were going for less. He signed a 12-month extension in return for a drop from $2,000 to $1,700.

His coworker Corey Browning asked his landlord for a $300 decrease for a “kind-of” one-bedroom in the Inner Richmond. The landlord offered a $150 reduction, to $2,350 a month, but Browning found a place for $2,200 — with a washer, dryer, garage and better bedroom to boot — and moved out.

Browning, who works another part-time job and splits the bill with his girlfriend, spends around 30 percent of his income on rent.

Michaels, who swings shifts as a barista and splits the bill with his wife, spends just under 50 percent of his income on rent. 

Carter, who gets paid through the GI Bill and splits the bill with his wife, expects to spend around 70 percent of his income on rent.

“Even though rent prices have fallen, it’s still insane … it’s just not quite as absolutely bonkers,” Browning said. “It’s hard to really call San Francisco a renter’s market — it’s more [of] a renter’s market than it was.”

Smaller owners squeezed

A year ago, no one would ask Rebecca Pearson, owner of SF Life Real Estate Inc., for cheaper listings.

These days, every tenant offers less than the asking price, she said.

For landlords, the consequences of the changing market largely depends on their total income, what fraction of their income comes from rent and whether they’re paying off a mortgage, said Noni Richen, president of Small Property Owners San Francisco. 

For smaller property owners in particular, expenses like electrical, sewage, garbage, maintenance, repairs, property taxes and insurance add up, said Richen and New, the director of the apartments association. 

“It’s not like we just sit on our piles of gold and run our fingers through it,” Richen said.

Price reductions vary with the neighborhood — rent in SoMA, for example, is more affected than in the Sunset because of the difference in job loss and the predominance of housing across the neighborhoods, according to New.

Mike Hirner, a decades-long real-estate broker and landlord, has had tenants leave two of his apartments, but avoided other vacancies by reducing rent for four of his other tenants. Staying competitive can create good showings that yield results, he said.

But he noted that he’s luckier than many when absorbing losses.

David Levy, a real estate agent for the San Francisco-based Baldini Property Management, said the property owners most impacted include those paying off a mortgage as well as senior residents, who often live on a fixed income and rely on rental payments to make ends meet. 

One landlady managing eight apartment units is at risk of losing two of her buildings, said Richen, from the small property owners group.

The landlady has paid the mortgage on time for 20 years. But most of her renters are among the minority of tenants citywide who have stopped paying rent, and the eviction moratorium has prevented her from replacing them.

She hasn’t paid the mortgage in months, and East West Bank is threatening to foreclose both buildings. She would probably be financially ruined, Richen said.

“A lot of tenants assume that because someone owns property or multiple properties, they’re millionaires, and they can afford to rent this place out for free,” Levy said. “That’s plain not true. A lot of people who rent out their property rent it out because they need money to pay the mortgage or bills or expenses.”

The master tenant’s dual burden

Jazmin Dominguez will see the rent at her Parkmerced apartment nearly double to $2,100 a month if she doesn’t fill her roommate’s sudden vacancy.

No one’s picked up the $1,000 lease Dominguez listed in November. She may go to $800 and absorb the monthly loss until her own lease expires in June.

Responsible for renting and renting out, master tenants are especially impacted by the rental market and often hard-pressed to list units for less than their original price. Many are students who’ve seen a flux of roommates vacate with colleges’ transition to online instruction.

Dominguez, who attends school full-time and works retail part-time, is just beginning to recover financially after quarantining twice since November. First, she contracted the novel coronavirus; then, she flew out to commemorate the death of a relative who died from Covid-19.

She typically spends 60 percent of her income on rent.

“Honestly, if I cannot find someone by the end of this month, I don’t know if I will be able to pay it off,” Dominguez said. “But at the same time, I cannot afford to not pay it off because if I don’t, then it’s like breaking the contract, and the fees for that are much higher than what I need to pay for the extra spot.”

In her Richmond District apartment, master tenant Natalie Medved has had six roommates in the last year. 

Because Medved was unable to fill the most recent vacancy, her rent doubled, and at $2,000 a month, it will consume 90 percent of her income as a full-time grocery worker.

“I take the brunt,” Medved said. “I find the people. I deal with the landlords.”

In this market, that puts master tenants like Medved in the most precarious position of all. 

Join the Conversation

21 Comments

  1. > “To use the term ‘renter’s market’ right now is still speaking to a housing market inflated by gentrification, the tax breaks tech companies have been given by our city and the opportunities and mobility gentrifiers have,” Belara said.

    And maybe just maaaayyyyybe, the fact that there just aren’t enough housing units.

    1. 30,000 vacant units, according to SF Tenant’s Union. And possibly more that aren’t reported. Would supervisors have passed a housing inventory law recently if there was wasn’t suspicions that landlords are hoarding housing units?

  2. Master tenants are landlords. In some ways, they have more rights to the unit they rent than landlords themselves. It makes sense that they’re having as rough of a year as landlords, difference being that as renters they likely have less wealth to insulate against the hardship.

    Reprinting without question quotes about how gentrification is the reason San Francisco is unaffordable is malpractice. Rents increased faster from 1980-2000 than from 2000-2020.

    1. “Reprinting without question quotes about how gentrification is the reason San Francisco is unaffordable is malpractice. Rents increased faster from 1980-2000 than from 2000-2020.”
      Sorry, but to infer that there wasn’t huge gentrification from 1980-2000 is very naive. The landscape and population of the Fillmore ( Nee “Lower Haight”), and the Western Addition) changed Drastically in that time, as well as the Mission… Not to mention that in that time the Filipino population of South of Market was expelled due to the building of the Moma, Yerba Buena Center for the Arts, Metreon center and surrounding buildings. It was especially great with the rebuilding after the earthquake, appointment of Willie Brown as mayor in the mid 90s, and the “dot com” boom.

    2. Seconding this point on master tenants. I certainly get why it may be tough in current times to be one just like it may be for a landlord, but I think the picture is incomplete if the article doesn’t mention the advantages of being a master tenant in normal times (just like there are advantages to being a landlord in the typically tight SF housing market).

      Often, master tenants will ask their sub leasers to sign contracts that allow for eviction without just cause. This may sound in violation of typical SF renter protections, but I believe the law makes an exception for master tenants. This makes some sense because, after all, the master tenant does have to share the same space as their subtenants and there has to be some way to resolve roommate incompatibility. The point is, being able to evict your subtenants more or less at will is one of the real advantages to being a master tenant on a reasonably affordable lease, back in the pre COVID times.

      Becoming a master tenant for an apartment that you cannot afford on your own is a risky financial decision. I’ve seen many posts in SF housing search groups where people look for others to join up and sign a lease together, as equals. That’s the right way to balance out risk if you are worried about no being able to find a roommate to help cover your rent as a master tenant. Of course, the trade-off is that you give up some control on the living space, but that’s the nature of things.

      I do sympathize with any master tenants like Jazmin Dominguez who are struggling to find roommates and have an unexpectedly high rent burden. I’m just pointing out that finding multiple people to sign a lease with is a fairly common solution people choose to avoid that risk.

      1. Agree wholeheartedly. Anyone who has ever been to the drop-in legal clinic at SF Tenants Union knows that 90% of the folks in there are experiencing issues with master tenants, who do seem to benefit from a myriad of loopholes in SF rental regulations. I was unfortunate enough to deal with a situation myself in which the master tenant was running a scheme: She lived in the in-law unit and rented out the upstairs 2bd/2ba of a single family home. She had the lease set up so that, certain amenities advertised in the listing (backyard, storage space in the garage) were not explicitly mentioned in the sublease, granting her the ability to suddenly “revoke access” at will. She also had the upper unit paying 4/5 of the rent and, this was the kicker, ALL electric and gas for the entire house. She said it was because the meter couldn’t be split and she was “extremely environmentally conscious” and hardly used anything. We quickly discovered that she was running electric space heaters 24/7 and an unlicensed dog boarding “business”, which led to her incessant use of the shared washer and dryer. Once concerns about paying for her astronomical utility usage occurred, she flipped a switch and commenced operation subtenant harassment, screaming derogatory insults anytime she saw us, dragging our belongings from the garage onto the public sidewalk, drunkenly shouting curse words outside our bedroom windows at 1 AM, locking us out of shared areas, and leaving a rifle out in the garage as a very clear implication of violence. She eventually emailed to say “if you’re so unhappy here, then buy out of your lease”… what? Oh yeah, she wanted us to essentially find a year+ of her monthly rent to escape her endless harassment. I feared for my family’s safety every day, had to get on an anxiety medication, and literally tiptoed around the house I was paying thousands to live in, terrified of what would set her off next.

        And the legal advice we received was…you’re stuck. We could up and leave, sure—but if she pursued us in court, which we knew she would, as she made it clear that she was very litigious (and we looked up her past cases in public records), the burden would all be on US to prove the nightmare she’d forced upon us. We even called the actual homeowner, who felt bad and said the master tenant had been a problem for years, but then also said his lawyer advised him not to communicate with us because we had no legal relationship.

        Ultimately, we stuck it out for a whole year—and then she stole over $4,000 from our security deposit (listing ridiculous things like replacing lightbulbs in the oven and fridge, which were certainly working when we left—no receipts, no log of hours or rates for anything).

        We opted to cut our losses because going to small claims court usually resulted in a 50/50 split on the judgment and she was unemployed (an “artist”), so we’d never have any way to collect what she owed.

        Given my experience, I know not all master tenants are bad—but it sure is hard for me to muster sympathy.

  3. “One landlady managing eight apartment units is at risk of losing two of her buildings (she) has paid the mortgage on time for 20 years…She would probably be financially ruined..”

    That’s simply a crock. She’s owned the two apartment buildings(among others) for 20 years and paid off most of the original mortgages. We’re to believe after 20 years her buildings aren’t worth much much more than her remaining mortgages. For that to be true, those buildings would have to be so badly dilapidated to be unlivable. Yet tenants still live there.

    1. Not necessarily, she may have higher loan to value mortgage or took another loan for repairs or other necessary costs. Regardless wether she did or not, it’s incumbent upon a tenant to fulfill their end of the contract by making timely rent payments. There are some that are gaming the system, by taking advantage of the current situation. Problem in SF is the biased politics associated with owing a property, SF prefers that those who rent, tend to remain so through out their lives. Btw I used to be a tenant myself.

    2. Another likely explanation is she took equity out of her older apartments to buy more investments (more apartments) or toys (cars, college tuition for kids, vacations, etc.).

  4. Rents would have dropped far further if not for rent control. Because of rent control, many landlords are selling off units which will be removed from the rental market, letting units sit vacant, or taking units off the market temporarily for renovations.

    In a normal market, landlords would “take what they can get” now knowing that they can raise rents in a year or two when the market comes back. Getting stuck with a lifetime tenant at a low rent is worse than eating a short term vacancy. Thanks to rent control, SF will never be a “renter’s market”.

  5. I lived in San Francisco from 93 to 2000 I had to work my butt off from sun up to sundown to pay the rent I had three roommates the city by the bay is beautiful but it’s hard to enjoy when you working all the time just to live there greed is what it is greed lower the rent some more people can enjoy the city before the ground starts shaking and tears it down

  6. The sad, tired stories of the twenty year landlords are completely false.  Request and show us the documents.  Tenants assume landlords are millionaires because it is true.  Property bought twenty years again has risen in value by 400-500% or more.  There is a tremendous amount of equity in these properties that can easily be accessed by refinancing at the lowest rates ever.  The property taxes on these properties are a small fraction of what would be paid by a new owner.  If these non-existent owners can’t pay their mortgage they have already refinanced and pulled out money to put into other investments.  The real estate industry always pulls out the sob story of the small landlord.  What we have is landlords making slightly less profit that the obscene profits they became used to.

    1. Preach. They never seem to mention the option they all have at their disposal: to sell the property and either reduce their real estate portfolio, or worst case scenario, become a renter again like the rest of us. I guess they never mention it because it’s too unspeakable to contemplate.

  7. There should have never been an eviction moratorium. If my tenant can’t pay right now, they definately can’t pay the back rent when it comes due. I was already in the middle of evicting them for property destruction when COVID hit. Now they have been living there for free, subleasing, and destorying my property. We were in the middle of a settlement for them to leave, when they knew about the moratorium and went against their lawyers advice and stopped communcation. Now the lawyer as a lien on the case and I hope future lawyer will not help them. After this is over, I am definitely taking them to court and going to garnish their wages and their credit. I am not a millionaire. This is my only property. Now I have to bare the cost of housing someone for free because I can’t get a court date.

    This moratorium is going to help hurt renters in the long run with Landlord’s wanting higher rents and strict background checks. San Francisco is just pushing the debt onto landlords. Many renters behind are just going to leave and landlord will not get their back rent.

    1. I think you forget that being a landlord is an investment and not all investments have positive outcomes. If you don’t want to deal with the risks anymore, sell your property and stop your whining.

      1. Why don’t you buy it, perhaps speed up your savings to own instead of “renting” someone’s property. Get a mortgage and save yourself from a future eviction.

      2. Yes every investment is risky. Even with an air tight lease, bad tenants would ruin years of gains through lost rent, properties damage, and lawyer fees. Now we can’t even enforce a written agreement. Government is literally telling landlords to house poeple without definite pay at the end. In the end landlords would need to hire lawyers to get rid of tenants not paying after this pandemic. Making the housing market harder for lower income poeple. Not all landlords are millionaires. Some just scrape by enough to buy a unit to build a better life for their children. And then you have tenants trying to take control of the system.

  8. Definately unfair for small landlords. A lot of articles assume you are a renter or a big real estate company. Policies don’t take into consideration poeple who own just one rental property that they depend on.
    They should never have put a eviction moratorium. No one is saying evict the single mom with three kids who fell behind on rent. What landlords want is to be able to evict tenants who are damaging property, causing nuisances, and plain breaking the lease. Not having a chance to go to court is a disgrace to our court system. If the tenants truly are suffering from COVID related issues, let them defend themselves in court. The courts are made for both sides to be heard in a neutral ground.

    Lawmakers stating “the rent is still due, but later” is a lousy answer. If tenants can’t pay now, they definitely cant pay rent later when it piles up. Saying you can take tenants to small claims court is a cop-out answer too. Cost more money to take tenants to small claims court. In the end, debt always falls on the landlords. Mortgages will be due, and landlords will have to sell cus they can’t enforce a lease.

      1. Because I saved up enough money, and I bought a 2 unit and rent the other one. I do not want to sell my home. Renting to someone is always a risk, even with a lease. But now I can’t even enforce a lease. No payment since January and they are sub leasing and stopped taking out the trash, and destroyed the floors with their dogs that aren’t allowed. Yet I can’t so anything about it. These are the stories that should be told.

        No one is saying evict the good tenants who pay on time that lost their jobs. We want the courts to open to kick out the lousy tenants. Be able to enforce a lease. And have a say to what happens to the property we spent years trying to buy. They’re never going to pay me back. I am not rich. I am just trying get by. I shouldn’t have to support people for free.

  9. I purchased my 400sq ft condo mid 2019 after, much like others mentioned, working my entire life and saving up and finally owning my own home in SF. Now, crime is so out of control, everyone I know has moved out (literally) and I’ve had my car broken into, people have attempted to break into my home and even cut my power from the outside. I’m a single woman with two small dogs and all I want to do is go back to my home state where my family is and I’m not an isolated target but I can’t sell because no one is buying and renting is horrifying bc of all the stories above.

    This city has broken my heart, I feel so stuck and like I’m eventually going to have to give up everything I’ve worked for my entire life and start from scratch. Not all of us are “landlords” – some of us are first time home buyers wanting to get out of this chaos and back to a safe environment without losing everything we’ve scraped by for decades to own and are now tethered to.

    This city has got to turn around the increasing crime, give landlords their rights back, and foo IO bf ways to subsidize rentals for necessary workers like teachers, nurses, police officers, small business owners, grocery store employees, etc…

    I wish I would’ve known how insane the landlord tenant laws were here and how much the legislation and judicial officials fight for open air drug use and sanctuary practices and have no care for those of us who are community contributors, tax payers, who loved the city enough to pay the ridiculous amount of our salaries to stay here bc we loved it (not bc it’s free, lawless, and an easy system to work). I would have NEVER bought this property.

    It’s beyond sad and impacting my life in egregious ways.

Leave a comment

Your email address will not be published. Required fields are marked *