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San Francisco rents barely changed during the Covid housing boom

(Bloomberg) — Rents in San Francisco and San Jose have changed little compared to two years ago, a sharp contrast with red-hot markets like Miami where housing costs have soared during the pandemic.

According to a Bloomberg analysis of data from Zillow Group Inc., California technology tops the top US metro areas with the smallest fare growth since February 2020. In New York City and Washington, DC, rental demand prices have increased by about 4% on an annual basis, less than half the national average of 8.5%.

Figures show some of the country’s priceless coastal cities have seen the least increase in pandemic-era rents.

“The major trend in demand for rental housing during the pandemic has been toward warmer, sunny, more affordable cities, and away from those that are cooler, more expensive, and places where a large proportion of people are in careers. which allows them to work remotely. Zillow senior economist Jeff Tucker said in an emailed statement.

The modest increase in housing costs is a hallmark of cities that have lagged behind in recovery, including New York. San Francisco is also struggling with one of the nation’s weakest office occupations and one of the nation’s slowest recoveries of jobs lost during COVID-19. And many tech companies are embracing remote work or letting employees take them elsewhere.

Still, that doesn’t mean that New York, San Francisco or San Jose has become affordable. Based on Zillow data, the median monthly rent in two cities in California is more than $3,000 in the country. This is about $1,200 more than the national level.

And last year the markets began to boom. San Francisco’s median rents fell below $2,800 at the end of 2020, but they again crossed the $3,000 mark last August and have been increasing ever since.

“It’s important to put these trends in the context of the pandemic,” said Danielle Hale, chief economist at Realtor.com. “While large tech cities missed the initial Covid surge in rents seen in other areas across the country as people fled to less expensive and crowded areas, the relative bargain renters in these historically expensive markets could quickly were disappearing.”

© 2022 Bloomberg LP

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