October 5, 2016
Big cities in California are among the high-rent markets nationally that are experiencing apartment rent declines. Rent levels declined year over year in three major markets – San Francisco, New York and San Jose – and increased by less than 2% in Oakland, the next highest rent-growth metro.
Declines continue to affect the overall apartment market, and that performance moderation is reflected in Axiometrics’ Q3 2016 data.
Axiometrics’ Jay Denton says, “Job growth isn’t bad in the Bay Area and New York, though the rate has slowed over the past year, so demand for apartments is still relatively strong.” Significant new supply, recently delivered and expected, will force owners and developers to keep rents lower for competitive reasons.
Though year-over-year rent growth was negative in San Francisco, the average Q3 rent was 2.6% higher than the average Q2 payment.
High-priced market performance was counteracted by robust fundamentals in secondary markets, including Sacramento and Riverside, CA.
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Tags: Apartments & Multifamily