The SF rental market is in flux—here’s what you need to know

The highly mobile, so-called “untethered” population in San Francisco responded to the effects of the Covid-19 pandemic with their feet. In 2020, like the residents of other densely packed urban centers, they left for the perceived safety of suburbs, rural outposts, and family homes. Moving tools and resources company MyMove analyzed data from the U.S Postal Service which showed that between February 1 and July 31, 2020, there were more than 27,000 change-of-address forms filed for households moving from San Francisco. 

Those who chose to stay were given the boon of unprecedented rental inventory and the lowest rental prices in San Francisco in years. According to Bungalow’s COVID rent trends analysis, rents bottomed out in August 2020, when the average price per room sank 4.2% compared to the previous month. After what looked like the beginnings of a rally, it dropped again in November, down 3.3% from the month before. 

Putting this in some pricing perspective, the median rent for a studio apartment dropped 35% in November 2020 from the month before, to $2,000, while the cost for a one-bedroom was down 27% to $2,716, according to

 But fueled by increasing vaccine-related optimism, prices in the rental market are on the way back up. In May of 2021, the price per room stayed essentially on par with the month prior and rose 1.7% from the month before in June. But do these rising rental prices point to a rebound?

View of the San Francisco skyline.

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What does a rebound look like? San Francisco in context

What does a rebound look like?

If you measure rebounds by rental prices, especially in San Francisco, it’s too soon to tell. Zumper, which represents citywide data across all rentals listed in the city, recorded a rise in average price per room of 2.2% from April to June. Bungalow, which rents rooms only in prime neighborhoods (where vacancies are lowest and the market is rebounding most quickly), recorded a 3.7% increase during the same period, indicating that the city’s most desirable neighborhoods maintained their appeal. 

 In March 2020, as the pandemic still seemed like a two-week inconvenience to most of the nation, rents in tech-intensive cities had been growing 2.8% year-over-year. According to the data, by May of 2021 most of the nation’s largest cities had recovered their prior monthly rental rates. By May in San Francisco, which felt the Covid-related disruption more harshly than most other cities, rents were still between 9 and 12% lower than their 2019 highs.

View of the Mission District street level in San Francisco.

San Francisco in context

A couple of factors separate San Francisco’s scenario from the recovery scenario of other big cities, like New York City, Boston, and Washington D.C. While San Francisco’s rents didn’t experience rental price swings that were quite as drastic as New York’s, it also didn’t see a population that specifically intended to return when the pandemic had abated, as New York did.

According to U.S. Postal Service and U.S. Census data, in the country’s 50 most populous cities, 84% of the people who moved relocated within their own metro area, and most who moved rather stayed within 150 miles. San Francisco and San Jose, with the largest percentage of people who belong to the so-called “untethered class,”—or those who don’t need to work in an office outside their home—lost a higher percentage of residents to permanent moves than New York.

In the Bay Area, since the moves were more likely to be to a close-by metro area, home prices in cities like Sacramento have spiked. Would-be buyers are finding themselves priced out of the market, and more people are opting to rent. San Francisco’s renter population was already high—56%—so it’s possible that those who are returning to the city or settling around it will begin seeing the area’s rebound reflected in higher priced single-family rentals.

 For now, as analysts weigh the effects of Covid on urban centers, they’re finding that urban centers aren’t dead. “People are more mobile and have more flexibility than ever and we are seeing migration trends in our data, both for short term moves to experience a new city or longer-term moves to relocate,” says Andrew Collins, CEO of Bungalow. “But our demographic is energized by urban living and the access, innovation and networks urban hubs afford.  Major cities like New York and San Francisco will always epitomize this dynamism of urban living and we expect a full market recovery in these cities.”

 Bungalow is the best way to invest and manage your real estate portfolio. We work with you to identify, purchase, fill, and manage residential properties—so that you can enjoy up to 20% more in rental income with a lot less stress. Learn more about Bungalow.

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