Last year, as anyone looking for an apartment knows, we saw huge rent increases, with double-digit jumps throughout much of the Bay Area. But 2016 is a different story, with an average rent growth of only 3.7 percent projected for the San Francisco metro area this year, according to research from AppFolio.
The property management software company found that all of the action has moved east, and not just to the Oakland metro area, which at 4.2 percent has the highest projected rent growth in the Bay Area. (The San Jose metro area has a projected rent growth of only 2.8 percent for 2016.) At 11 percent, Sacramento has the nation’s highest rent growth, a “symptom of very short supply and strong job growth creating higher demand,” according to AppFolio’s VP for Product, Nat Kunes, who added that there are only 255 new units coming to the 2.2 million-resident market this year.
But after years of slow apartment development, San Francisco is actually expecting to see over 9,000 new units come to market in 2016, according to research from RentCafe. That boosts rental inventory by 126 percent over 2015’s numbers, according to the rental site. (Check out the gallery above for some of the luxe new rentals coming to market, and their starting asking rents.)
These newly built rental buildings tend to target the top of the market, which is where Kunes says the competition for rentals has been “fiercest.” In a recent AppFolio survey, nearly 80 percent of San Francisco respondents making more than $150,000 said that competition from other renters was the worst part of the rental process. But this may begin to change with the increased inventory. “Additional supply at the top of the market is one factor behind the overall slowing of rental growth,” Kunes said.
To continue reading this article by Emily Landes, go to: http://blog.sfgate.com/onthebl...ches-up-with-demand/
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