The economic disruption brought by the pandemic is subsiding, according to a recent rent report showing that monthly living costs in San Mateo are regularly tracking upward with the rest of the nation
Rents in San Mateo gained 2% from April to May, according to a rent report from Apartment List, marking the fourth straight month that prices have ticked up since January, when the virus was hitting its peak surge.
The increases follow a national trend of steady gains for 2021, but pricing in San Mateo still lags far behind the rates seen locally last year when the full toll of the pandemic had yet to hit. To that end, local rents are still 11% lower than they were last year.
The median rent for a one-bedroom unit in San Mateo is $2,198, according to the Apartment List report, which said the median rent for a two-bedroom unit is $2,985. Similarly in Redwood City, the median rent for a one-bedroom units is $2,120 and $2,700 for a two-bedroom unit.
While local prices are lower than before, the Peninsula remains one of the nation’s most expensive locales. For perspective, the median rent for a two-bedroom unit in San Mateo is more than twice the cost for a similar place in Dallas.
Rents on the Peninsula have followed the direction of the larger Bay Area market, which plunged precipitously from March 2020 through January of this year.
“Rent prices have been decreasing not just in San Mateo over the past year, but across the entire metro. Of the largest 10 cities in the San Francisco metro for which we have data, seven of them have seen prices drop,” said the Apartment List report.
To that end, the largest national rent dips since last March occurred in San Francisco and Oakland, which dropped 17% and 13% respectively. Rents in San Jose dropped 10% as well. For context, rents in New York dropped by 12%, Seattle fell by 11% and Washington, D.C., fell by 9%.
And while the declines were precipitous, the markets have shown swift recovery, according to the Apartment List report.
“Rents in San Francisco, for example, are still 17% lower than they were in March 2020, but the city has seen prices increase by 13% over just the past four months,” said the report. “Nine of the 10 cities with the sharpest year-over-year declines have now had four consecutive months of rising rents.”
That rate of gain is shown nationally outside of coastal metropolitan areas as well, according to the report, which showed the rent index is up by 2.3% per month — marking the largest such increase in five years.
The most recent leap continues a trend of rent index growth, leaving the marker at unexpected heights, said the report.
“Our national index is now above the level where we project it would have been if the pandemic-related price declines of 2020 had never occurred at all,” said the report declaring that “pandemic pricing is officially over.”
Critics of online databases often claim the rates cited skew too high because they largely track new construction, which is more expensive — fueling fears that the figures offer an unrealistic portrait of a market that also includes older, cheaper units. Apartment List claims its methodology has been adjusted to offer a fuller and more accurate perspective of the market.
The growth shown in the rental market is not unique, according to a new report from CoreLogic showing that home sales prices gained 13% annually according to the company’s home price index, marking the most significant growth since 2006.
National home prices increased by 2% over the month, according to the CoreLogic report, and additional growth is expected over the coming month.
“Home prices are projected to increase 2.8% by April 2022, as affordability and supply challenges drive potential buyers out of the market, causing a slowdown in home price growth,” said the report.
In late May, the median home sales price in San Mateo County was $2.02 million, continuing growth after the county ticked past the $2 million median sales price in April.