San Jose Multifamily Report – Spring 2020
San Jose's tech-anchored economy is providing relatively strong insulation for the metro's multifamily market.
San Jose rent evolution, click to enlarge
The San Jose metro is bolstered by its tech-anchored economy, which, in the course of the ongoing slowdown, is fairly well insulated to withstand the economic fallout. Rents in the metro were even up 0.1 percent on a trailing three-month basis as of April, while the U.S. rate plateaued. The metro had been gearing up for record rental inventory growth this year, but delays due to pandemic related restrictions will likely curb that rise.
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With the state processing over 4.7 million initial unemployment claims since the start of the outbreak, economic issues are in sight for California as a whole. While the South Bay’s economy is well insulated against the bulk of the issues that are projected, some sectors saw mounting trouble as early as March—leisure and hospitality, the hardest-hit industry, had already lost 9,100 jobs year-over-year.
San Jose sales volume and number of properties sold, click to enlarge
With construction procedures put in place to help get projects back underway, some relief in that sector is expected this summer. San Jose’s average occupancy in stabilized assets stood at 95.4 percent as of March, well above the national figure. With broad eviction moratoriums in place, that figure hasn’t seen significant fluctuations yet, although county authorities are seeking to prolong the measure, pending state-level decisions.
