A report released by the National Low Income Housing Coalition shows that San Francisco is the most expensive place in the country to rent housing. The average rent on a 2 bedroom property in SF is $1,905 per month. The tenant would need to make at least $76,000 a year to be able to afford rent.
The city’s median family income of $103,000 is above the nations average, high rents have the effect of pricing people on the lower side of the economic spectrum out of the market almost entirely. Rent increases have increased into overdrive in recently since many have been the hardest hit in the nation by the foreclosure crisis.
Since so many people have been displaced from home ownership that are coming back into the rental market, and the rental market in the past 4 years has not had too much new supply added. Therefore, the vacancies have dropped and the rental rates have begun to go up much faster than anyone anticipated.
A common misconception the foreclosure crisis has made in San Francisco is that it is now a more affordable place to live.
Another factor pushing up rents in San Francisco is the lack of inventory . The city’s high density and aversion to new developments makes the construction of new housing rare. Rent control also tends to encourage people to stay put longer, ultimately resulting in a low supply of open units.
The high cost of housing in San Francisco is the main reason families flee the city for the suburbs every year. Only 13.4% of San Francisco’s approximately 800,000 people are under the age of 18– the lowest proportion of kids for any major city in the United States.
What’s happening in the city mirrors the growing trend in the rest of the country– home ownership rates are at their lowest level since 1998, resulting in more Americans turning to the rental market.