San Francisco Multifamily Report – Summer 2019
The metro's rents continue to inflate amid job growth, a housing shortage and rent control measures.
San Francisco rent evolution, click to enlarge
San Francisco’s housing shortage is putting a lot of pressure on residents and policymakers alike, with local authorities revisiting rent control legislation. In the meantime, rents continued their rise, up 3.2 percent year-over-year to $2,735 as of June. The amount is nearly twice the $1,465 U.S. figure.
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San Francisco gained 69,200 jobs in the 12 months ending in April. Professional and business services (20,200 jobs), education and health services (14,400 jobs) and mining, logging and construction (12,400 jobs) led growth and are poised to continue on an upward trend. In the past year, Google expanded its local office footprint to 1.5 million square feet, making it the metro’s third-largest tenant. Additionally, its $15 billion partnership with Lendlease to develop three new neighborhoods in the Bay Area will incorporate forces from all sectors. The project’s design encompasses 15.1 million square feet of mixed-use developments as well as 15,000 units spanning all income levels, including low-income housing.
San Francisco sales volume and number of properties sold, click to enlarge
By mid-year, nearly $908 million in apartments had traded in the metro. With 21,687 units underway as of June and 5,771 units slated for delivery by the end of 2019, supply will likely affect rent growth. We expect the average rent in San Francisco to advance 2.8 percent this year.
