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: Calculated Risk

Apartment Rents increasing in San Francisco

By Anonymous

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From Robert Selna at the San Francisco Chronicle: San Francisco apartment rents expected to rise

Data from real estate research firm RealFacts show that San Francisco County's average asking rent for buildings of 50 or more units was $2,282 in the third quarter of 2010, only about $120 lower than the same quarter in 2008.
...
Marcus & Millichap, which tracks rents citywide in buildings of 15 units or more, reported that since the start of the year, the average asking rent had increased 1.4 percent to $1,782.

This fits with other reports of falling vacancy rates and rents at least stabilizing.

Reis reported that the vacancy rate declined sharply in Q3, and rents increased.

The Census Bureau reported the rental vacancy rate declined to 10.3% in Q3 2010 from 10.6% in Q2.

The quarterly apartment survey from the National Multi Housing Council (NMHC) showed markets were tighter with lower vacancies and/or higher rents.

It appears apartment rents have at least stabilized and are probably increasing in many areas - and the vacancy rates are falling. This means we will probably see a slight pickup in multi-family construction in 2011 (from record lows).

Before the housing market can recovery, a large portion of the excess vacant housing supply has to be absorbed. The excess supply includes both rental and owner occupied homes, and the falling apartment vacancy rate is an indicator the excess supply is starting to decline.

Full post as published by Calculated Risk on November 13, 2010 (boomark / email).