Posted on 07/03/2020 7:39:13 AM PDT by SeekAndFind
Readers may recall, as early as March, city dwellers in California fled to suburbs and remote areas to isolate from the virus pandemic. The proliferation of remote work arrangements has led this shift to become more permanent.
At first, the exodus out of the city was due to virus-related lockdowns, then social unrest, and now it appears a steady flow of folks are leaving the San Francisco Bay Area for rural communities as their flexible work environment (i.e., remote access) allows them to work from anywhere, more specifically, outside city centers where the cost of living is a whole lot cheaper.
Bloomberg notes, citing a new report from rental website Zumper, the latest emigration trend out of the Bay Area has resulted in rents for a San Francisco one-bedroom apartment to plunge 12% in June compared with last year, which is one of the most significant monthly declines on record.
“Zumper has been tracking rent prices across the country for over five years but we have never seen the market fluctuate quite like this,” Zumper co-founder and CEO Anthemos Georgiades said. “For example, rent prices in San Francisco have historically only gone up and typically only incrementally, yet now we are seeing double-digit percent rent reductions. This is unprecedented for this generation of renters.”
Georgiades said the ability to work remotely led to the exodus of city dwellers:
“The very real move of many mainly technology employers to a future of remote work, meaning millions of employees now looking outside of dense metropolitan areas for their next home now that their commute time is no longer a factor,” Georgiades said.
“Silicon Valley hubs such as Mountain View and Palo Alto also saw rents plunge — a sign residents of the tech-heavy region are taking advantage of remote work arrangements to flee to cheaper areas,” Bloomberg said.
“This is the strangest downturn I’ve ever seen,” J.J. Panzer with the Real Management Company told San Francisco KPIX 5.
Rental inventory in the Bay Area has increased since the pandemic began – allowing renters to renegotiate leases and ask for a 10-15% reduction in rents.
Other factors for the steep drop in rents is mainly because of the recession and high unemployment. People can no longer afford pricey rentals in San Francisco – must leave city centers for suburbs where rents are significantly less.
“As the pandemic persists on, the demand for rentals has continued to shift away from these pricey areas, and a significant amount of that demand seems to be moving toward neighboring, less expensive areas,” Zumper said on its blog.
“Your landlord, given the widespread nature of the job loss, actually does have an incentive to negotiate a lower rent with you,” said senior Zillow economist Skyler Olsen.
“Vacant units have no value coming upstream to pay their property taxes and their mortgage and that value as part of the system,” said Olsen.
Financial blog Market Crumbs notes, “with the rise of remote work seemingly inevitable at this point, this trend should continue in San Francisco as well as other major cities in the years to come.”
Urban America, controlled by Democrats, is becoming unlivable. Businesses are fleeing as well. The problem is that these urban refugees take their vile politics with them when the flee to decent areas.
Correct. These idiots never learn. They spread their voting mental disorder everywhere they go.
The surprise is that Oakland rents went up. As my wife, who used to work there, said, “Who would want to live in Oakland?”
Places in the South Bay, like Palo Alto, Mountain View, Cupertino, Sunnyvale, Saratosa, Los Altos, etc., should start seeing property values drop has the homeless camps expand through their cities. Having rents drop off the table is just speeding up the process.
It’s not just economics. These cities have bent over backwards to accommodate the dysfunctional and the lawless that they’ve actually attracted them en masse, thus crating mass homeless encampments and widespread use of streets as public toilets.
The laptop computer has rendered the big city downtown moot. Most big cities have a second or third downtown 50-100 blocks out from the old downtown.
Unfortunately I am stuck in Oakland until the wife retires, probably another 10-12 years.
My selfish fantasy is that her employer (Oakland Public Library) does something egregious that makes her say “Enough!” It could happen.
The flat part of Oakland is bad news—but the Oakland Hills are beautiful and pricy.
Supply and demand, demand and supply. Good, sure they were priced way more than they are worth. A step back towards reality land.
Any chance Oakland will get gentrified? If any place needs it...
It was the home computer with internet, then the laptop, but the final kiss of death was working paperless. If people didn’t need to print massive reports anymore, or need access to fax machines (with “e-signing” of documents and such), then why herd people into cubicle farms?
I’ve always warn people that when all of your work can be done remotely, it could be done halfway around the world.
Most spot on that most cities have a 2nd city blocks away. Downtown Denver has the Cherry Creek business/shopping city center about 1 mile away, and also the Denver Tech Center which is about 5 miles away. And there are many more people who are working from home and using courier services to transport hard copy paper to and from the house to the office or to another house. Alvin Toffler and the book Thrird Wave said the ideas are about everyone has to be on the main grid or just simply leaving the 20th century grid and going their own way. Why commute to the office when it is easier and more cost effective to stay at home. And then there is The Donna Reed Show where Dr. Stone had a medical office in the house rather than in a medical building. As a patient I would rather go to a medical facility. For most other work, a home or non Downtown location would be preferable.
A 11.8% drop in rents in SF probably still means a studio apartment rents for $8,000 a month.
Supply and demand.
There’s a steady supply of shit on the streets so demand for apartments goes down.
Oakland is large and many areas within it are very nice.
Strange! Unforseen! Authorities remain baffled.
Yes San Francisco is quite gutted.
It’s not as dramatic as the news implies. There are not piles of poo poo everywhere.
However the tenderloin and south of market really are covered with addicts and the brain damaged. They sit around, they deal, they fight, of course they camp. Some have stuff laid out to sell. They steal bikes. You see trannies and prostitutes and open drug use. Many are just passed out or asleep, just out there in the sidewalk. They wander into traffic. They line up at food distribution.
Property crime is bad because it’s not prosecuted. That said violent Crime is somewhat low. In a libertarian dream I can only say this is true because most San Franciscans are trying to get along and not be violent.
The richest city has become a place of extreme mental ward poverty and mansions with locked gates. The dinky middle class keeps trying to function. But they don’t vote properly. We have, time and time again, voted for this.
It’s also not fleeing, as they mentioned.
San Francisco is hostile to renters. Eviction is a nightmare. So a renter facing a tenant with a job loss is incentivized to take whatever they’ll pay and eat the loss. If they try and evict, they get $0 for the several months it takes to toss them. So it’s best to take a 15% cut.
Gary Buechler is one of the people fleeing. He made it clear he can’t rent out his house because of the job losses it’s too high of a risk he’ll get stuck with a renter who won’t pay and he’ll be out thousands in upkeep.
These people voted for what they are fleeing...will they keep voting for it in their new surroundings?
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.