Bay Area apartment rents fell last month faster than the national average in a slowing local economy ruptured by mass tech layoffs.
Metro market rents are down 5 percent in January compared to March 2020 at the dawn of the pandemic, the San Francisco Chronicle reported, citing data from Apartment List.
San Francisco and San Jose are the only metro areas with more than one million people with rents below pre-COVID-19 levels.
San Francisco median rents in January fell 1.1 percent to $2,174 a month compared to December, one of the biggest drops in the country.
San Jose’s median price fell 0.4 percent to $2,370 a month compared to December. Prices are 2 percent lower than March 2020.
At the same time, Oakland saw a 0.9 percent monthly decline to a $1,613 monthly median rent.
National rents fell for the fifth straight month, with prices down 0.3 percent compared to December. Prices are still up 3.3 percent compared to January 2022, but growth has slowed in the past two years. Two-thirds of the 100 largest U.S. cities saw rents down month over month, according to the Chronicle.
Nationally, rents are expected to climb again during the busier spring and summer months.
Locally, a wave of layoffs in tech is expected to reduce demand for apartments in the Bay Area.
“Softness in the tech industry is likely to prevent a strong rebound in Bay Area rents,” Apartment List said.
An exception may be in Redwood City, where the cost of a one-bedroom apartment last fall shot up 32 percent to $2,900 from the prior year, according to Zumper.
Bay Area home values have declined in the past six months as mortgage rates have shot up, according to Zillow. The regional price hit $1.08 million in December, 11.5 percent less than the previous month.
Real estate experts think home prices in California and the Bay Area could slide 8 percent more this year.
— Dana Bartholomew