Rents for homes in San Mateo County have been sky high and experts aren’t seeing any sign this will slow down.
The average rent for an apartment in the second quarter of 2014 was $2,470, up from $2,360 in the first quarter. The average one-bedroom, one-bathroom apartment was $2,238, up from $2,136 in the first quarter. The average occupancy rate was 95.1 percent, up 1.4 percent from the same time last year, according to RealAnswers, a group that compiles apartment data. California minimum wage is $9 per hour.
High rents aren’t unique to the Peninsula though. In the second quarter of this year, apartment rental rates in San Mateo County were on par with San Francisco, Marin and Santa Clara counties. The average rent in San Francisco County was $3,229, while the average rent in Santa Clara County was $2,321 and Marin County’s average rent was $2,231, according to RealAnswers.
Available rentals go quickly, said Sally Navarro, a rental, sales and property management Realtor for AVR Realty in Burlingame.
“Things are leasing off the shelves,” she said. “We don’t have a lot of inventory. … We’re not really expecting things to change soon; it’s still been really strong. If interest rates go up in August, more people will be looking to rent.”
It is still harder to rent a house than an apartment, she said. She showed a property to one family from out of the area in the Beresford neighborhood in San Mateo, but the preschool the family wanted the child to go to was already full.
“A lot of families are doing their homework and they know if there’s an opening in the school or not,” she said. “You can fall in love (with a home), but if there’s no opening, you’ve got to find something else.”
Other leasing agents agree, including Mita Kapadia, a Realtor for RE/MAX in Redwood Shores. She rents out spaces from Daly City to San Jose.
“I don’t think things will settle out soon,” she said. “With Google, Facebook and other companies all expanding there’s so many people that are coming into this area. I think it’s going to keep going up.”
Kapadia has seen a major shift in the rental market since she began helping clients find spaces to lease four years ago.
“It’s changed dramatically,” she said. “Before you saw rentals and they would stay on the market. Now, they get rented out right away.”
This trend of higher rents isn’t going to change anytime soon, but it should slow, said Nick Grotjahn, sales and client services representative for RealAnswers.
“They’re going to continue to go up, albeit a little bit slower in the major tech centers just because they’ve gotten so high employment can only affect that for so long,” he said. “The driving force here (for rents) is high-tech.”
Those like Mark Moulton, executive director of the Housing Leadership Council of San Mateo County, are advocating for more affordable housing along the Peninsula. His group works to accelerate the production of new homes in the county at all affordability levels to create opportunities and a viable quality of life.
“From the view of renters with moderate incomes, rent increases exceed rates of income growth and the percentage of income paid for housing goes up until folks are displaced, sometimes more than a county away,” he wrote in an email. “The cost of the commute to the job is part of the housing cost.”
The increase in rents has caused a tremendous strain on people renting along the Peninsula, said Joshua Hugg, program manager for the Housing Leadership Council of San Mateo County. There is a really big gap between those who own homes in the county, and have benefited from tremendous appreciation and intergenerational wealth, and renters, who don’t have that stability, he added.
“You have a lot of people who are experiencing a lot of stress right now because of the high rents,” he said. “It’s gonna be a long effort. ... Coping means things like less discretionary income, which affects the economy and overcrowding.”
At the same time, the county’s homeless rate has risen 12 percent since 2011, according to a report from the county’s Health and Human Services Agency, compiled in January 2013. There are 2,281 homeless people in the county as of January, with 1,299 unsheltered homeless people and 982 sheltered homeless people, according to the report. The next homeless count will be conducted in January 2015.
Meanwhile, Navarro offers various tips to those looking to lease, including driving around the neighborhood and looking for lease signs by owners.
“Have everything ready to go,” she said. “Applications, credit reports, driver’s license and cashiers check payable to no one yet. Just be proactive cause the folks that put something on Craigslist get a couple dozen people showing up. The one who is ready to go will have a better shot at finding something cause things go fast.”
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