Last $130.97 USD
Change Today -1.05 / -0.80%
Volume 1.3M
Z On Other Exchanges
Symbol
Exchange
NASDAQ GS
Berlin
As of 8:10 PM 09/19/14 All times are local (Market data is delayed by at least 15 minutes).
text size: T | T
McClatchy-Tribune  07/27/2014 12:01 AM ET
Rents zoom 9.5 percent in Marin, expected to keep zooming [The Marin Independent Journal, Novato, Calif. :: ]

July 27--Marin apartment rents zoomed upward at nearly double-digit rates in the second quarter along with rents throughout the Bay Area, a report said, and they are expected to keep zooming.

Asking rents in Marin averaged $2,232 in the second quarter of this year, higher than the $2,158 average for the nine-county Bay Area, according to a report by Novato-based RealFacts, a local real estate tracking company. This was a record high for Marin.

The jump in Marin rents represents a 9.5 percent increase over the same April-June period of 2013. An array of rental units was surveyed, including studios, one-, two- and three-bedroom apartments and townhouses. Overall, Bay Area rents are up 10.3 percent compared with a year ago.

"This is not just a little blip," said Michael Burke, a Coldwell Banker agent who has specialized in Marin apartment sales for 20 years. "You are going to see rents continue to rise at a substantial rate."

Marin rents are up 2.5 percent from the first quarter, while Bay Area rents saw a 5.6 percent jump from the first quarter.

"Rents have been on a rapid increase since 2010, after we experienced three years of flat rents," Burke said. "If you look at the statistics on a two-year basis, going back two years, rents are up 18.7 percent.

"The key is not so much in the rents as the vacancy rate, which is 2.8 percent," Burke said. "This is a forward-leading indicator of where rents are going to go. There is still incredible demand on rates because of the low vacancy rate."

The Marin apartments tracked by RealFacts are 97.2 percent occupied, according to Nick Grotjahn of RealFacts.

"Anything above 95 percent is technically fully occupied," Grotjahn said. "The way you have to look at it is that if it's a 100-unit building and 95 units are occupied, there's only five units that are not occupied."

"One other added pressure to the rental market might be: The housing market has strengthened with prices rising and inventory limited," Burke said. "Also, interest rates have taken a rise. All of this has the effect that home ownership and mortgages are harder to qualify for, therefore, tenants are remaining longer in the rental scene adding pressure to the demand side."

"It's ridiculous," said Ryan Tanner, 27, who lives with his parents in Fairfax. "I wouldn't be able to move forward with savings or anything in my life if I had to pay rent. Friends of mine live in with other friends and all live together. I am fortunate enough to live close to my family."

Across the area, Alameda County saw the biggest percentage gain in rents, up 12 percent from a year ago to an average rent of $1,928 a month. The area's under pressure partly because of refugees from San Francisco, where rents averaged $3,229 in the second quarter, a 9.4 percent annual gain. The San Francisco metro area has the highest rents among the country's 25 largest rental markets, according to online real estate site Trulia.

The average apartment asking rent was up 9 percent to $2,321 in Santa Clara County; up 8 percent to $1,609 in Contra Costa County and up 8.1 percent to $2,470 in San Mateo County.

A limited supply and strong demand are responsible, economists and housing experts say. Some have expressed concerns that continued job growth in the region, boosted by the remarkable boom in tech, is unsustainable without similar growth in housing.

Jim Wunderman, president and chief executive of the Bay Area Council, said the region needs to work together to build more housing.

"There needs to be a partnership between cities, counties and companies to get housing built fast so that we can enable the growth pattern to continue," he said. "Otherwise, it forces labor costs up because a company has to pay more because of the rising cost of living. They'll do that for a while, but eventually they'll start looking for alternatives."

 

Stock Quotes

Market data is delayed at least 15 minutes.

Company Lookup
Recently Viewed
Z:US $130.97 USD -1.05

Industry News

Sponsored Financial Commentaries

Sponsored Links

Report Data Issue

To contact ZILLOW INC-CLASS A, please visit . Company data is provided by Capital IQ. Please use this form to report any data issues.

Please enter your information in the following field(s):
Update Needed*

All data changes require verification from public sources. Please include the correct value or values and a source where we can verify.

Your requested update has been submitted

Our data partners will research the update request and update the information on this page if necessary. Research and follow-up could take several weeks. If you have questions, you can contact them at bwwebmaster@businessweek.com.