San Francisco Multifamily Report – July 2024
By many metrics, the Bay Area is outperforming national averages.
San Francisco started 2024 with a modest recovery following several months of contractions. Advertised asking rents were up 0.5 percent on a trailing three-month basis through May, to $2,799, outpacing the nation’s 0.3 percent. The metro’s average outpaced the U.S. for the first time in more than a year. Occupancy remained steady, at 95.3 percent in stabilized properties as of April, unchanged from last year, unlike several other major markets where rates have been declining. Meanwhile, the national average was down 60 basis points, to 94.5 percent.
Unemployment increased 90 basis points year-over-year, to 3.9 percent as of April, according to preliminary data from the Bureau of Labor Statistics. This was on par with the nation, but significantly below California’s 5.3 percent. The metro added 14,800 jobs over the 12-month period ending in March, accounting for a 0.3 percent expansion, 110 basis points below the U.S. rate of growth. Education and health services gained the most jobs (26,000), while the information sector recorded the most significant losses (-14,700). The metro’s second-largest sector is sustained by ongoing major projects, such as the $4.3 billion expansion of UCSF Parnassus Heights Hospital.
San Francisco’s existing multifamily stock expanded 1.0 percent in the first five months of the year, slightly above the U.S. by 10 basis points. However, the 77.7 percent decline in construction starts indicates that development is slowing down.
