Prices are zooming in the Bay Area as startups hire and new techies flock to town.
Whether we’re living through another tech bubble remains hotly contested, but there’s no denying its impact on one market: rental apartments in San Francisco. With Twitter, Zynga, and numerous other local startups hiring in droves, all those newbies need somewhere to live.
In the trendy SoMa and South Beach neighborhoods, says Paul Hwang of Skybox Realty, there may be up to five applications for every apartment listing. Most places are renting at an average of 10% to 20% higher than just six months ago; a $2,400-a-month one-bedroom can now top $2,700.
“The last couple of years, people were happy to have a job,” says Hwang. “Now all I hear is, ‘I’m going to start my own thing.’ All that can be reflected in rent.”
As a result, the apartment hunt can be even more grueling for prospective residents.
Naseem Zojwalla, a New York transplant and senior medical director at Onyx Pharmaceuticals, had four days to find an apartment in SoMa, her neighborhood of choice. She saw 10 apartments — where as many as 10 people showed up for tours — but it wasn’t until someone terminated their lease at The Paramount, a luxury rental apartment building, that Zojwalla landed a 800-square-foot one-bedroom unit for $3,000.
“It was definitely more expensive than I expected,” she recalls.
Don’t expect the situation to change any time soon. In fact, brokers expect tech hiring to further intensify this fall and next spring as companies further ramp up hiring. Maybe the solution is to make sure that every new workspace comes with a very comfy couch.