Rents in the Bay Area are on the rise due to the booming tech sector and sluggish homebuyers market. In response to an increase in high paying jobs in the region and foreclosures moving former homeowners into the rental market, prices have skyrocketed from over a year ago. Across the Bay area and Silicon Valley average rental rates have increased 5-6.6%. Studio apartment in San Francisco have seen a 13% increase up from $1,595 last year to $1,801 this year.
The competition is fierce, to say the least. Vacancy rates are low and apartments are rented in hours. In such a fast paced market, being ahead of the game is critical. Poor credit scores and the need for a co-signer are factors that could put you behind in such a competitive market. However, if you have a high paying job and are very financially stable, you may also be considered a risky renter. Landlords are looking for long-term residents and if they perceive you to be a short-term renter – either looking to upsize over time or looking to buy a house – then you also might struggle to find a place.
Regardless of where you fall in this spectrum, arm yourself by being prepared. Set your expectations and then be ready to raise them if necessary. But, KNOW YOUR LIMITS. What are you willing to settle for? How much are you willing to pay? Before you start the search, take a look at your financial situation and give yourself a realistic range on what you can afford. Write down your absolute maximum rent. Absolute maximum – and then don’t budge from that. You don’t want to get in financial trouble, damage your credit, or sacrifice other very important items (oh, like food).
If you are like most renters you probably don’t have the luxury of time, so having a backup plan is critical. If you can’t find a place to rent find someone to stay with, in fact, find a place to crash while you are apartment hunting. Reach out to friends and let everyone know you’re looking for a place. In this type of market you need to be realistic, know your limits and have a backup plan. Good luck!