The Covid-19 pandemic has majorly slashed rent prices in the Golden City.
For some tenants living in Oakland, San Francisco’s rent drop as a result of the pandemic has offered some unexpected new opportunities for housing. Middle- and upper-income earners have found apartments for rent that never would have been available at the current price points pre-pandemic.
After a mass exodus of city employees who may now work from home permanently, landlords are increasingly desperate to rent out their newly available spaces. Some have been known to offer incentives such as free months’ rent, cable and internet credit, massage sessions, and debit cards with money pre-loaded onto them. These perks make it possible for the pros to ultimately outweigh the cons, and some Oakland residents are picking up on that.
San Francisco’s rent experienced one of the greatest decreases in the US during Covid-19. According to SF’s rent report at Apartment.Com, the city’s rent decreased 27% over the course of 2020, in comparison with a -1.2% decrease nationwide and a -5.2% decrease statewide.
[Image: Screenshot from ApartmentList.Com]
While SF is still the costliest city in the nation ($5.56 per square foot in October 2020, according to Move.Org), it may in some cases boast better deals than Oakland, the runner-up ($4.50 per square foot).
Of course, many of these changes benefit higher income-earners, while low-income residents working in hospitality and service jobs don’t have the luxury of working from home. As a result, the sky-high rent in San Francisco is still insurmountable for a large part of the Bay Area’s population.
But for those who can work from home, the city’s once-bustling city streets and social scene have gone eerily quiet, and many feel that it doesn’t make sense to stick around under the circumstances.
According to the Bay Area Council Economic Institute, “up to 45% of jobs in the Bay Area are eligible to work remotely, equating to a total of 1.79 million remote eligible jobs in the region.” In San Francisco specifically, 51% of all jobs are remote eligible. Since tech giants such as Salesforce have made remote work a permanent option, many employees have left the city in droves.
[Image: Patrick Perkins via Unsplash
Wasserman-Stern Attorneys At Law warns landlords that offering rent reduction due to market conditions may lead to that change being permanent in a post-Covid 19 down market. Their website states, “Indeed, if you offer a month’s free rent for a one-year term, the Rent Board will say that the value of that month is then amortized over the 12-month period of the initial term and then lowers the base rent for all future months by that amount… Rent rebates or reductions may only be lawfully rescinded, canceled, or withdrawn if the rebate or reduction is given because of a tenant’s particular need or hardship.”
While San Francisco remains just as expensive as ever for thousands of residents, its new role as an alternative solution for Oakland tenants is unprecedented. And of course, the pandemic’s long-term repercussions on the Bay Area’s housing market are only just starting to become clear.
[Featured Image: Ira Komornik via Unsplash]