Champagne and Signing Bonuses: Welcome to San Fran’s Rental Market

by Shilpi Paul

Champagne and Signing Bonuses: Welcome to San Fran’s Rental Market: Figure 1
A San Francisco loft renting for $7,000 a month.

In a slight departure from the DC real estate world on this rainy Friday, UrbanTurf decided to head 3,000 miles west, and take a closer look at San Francisco’s much buzzed about rental market.

“$3000 per month, 1 bedroom in the Mission. Ridiculous? Yes. Make an offer, let’s talk.”

This language was part of a Craigslist posting that recently made the rounds on blogs in San Francisco.

The ad, which displayed pictures of a run-down, 600-square foot unit, goes on to outline demands from prospective tenants, such as “your elevator-pitch resume” and most shockingly — and illegally — an “offer of a signing bonus.” Outlandish as it sounds, apartment ads demanding concessions, in addition to sky-high rent, are becoming the norm in San Francisco.

“This was my life a few weeks ago,” a commenter on one blog wrote. “S*** is no joke. Highway robbery.”

It is no secret that rents in major U.S. cities (including this one) have been steadily increasing over the past year. However, in San Francisco the jumps are jaw-dropping. In June, Trulia’s Rent Monitor found that rent prices in San Francisco were 14.7 percent higher than they were 12 months earlier, a percentage that creeps higher every month and that is well above the rate of increase in any other city. With Facebook’s recent IPO (and subsequent population of new millionaires) and a new tech boom drawing in well-paid new residents, landlords all over the city are cashing in.

“San Francisco has strong job growth, expensive home prices, and relatively little new construction,” Jed Kolko, Trulia’s Chief Economist, told UrbanTurf. “The high cost of housing means many people have no choice but to rent, and the limited new construction – thanks to both geography and regulations – means that there’s little new housing to match growing demand.

UrbanTurf spoke with a few San Francisco residents who said that even if you have the money, the rental market is so competitive that landlords can afford to be extremely picky, forcing hopeful renters to embark on elaborate means of distinguishing themselves from the crowd. Love letters, an occasional occurrence in the for-sale market, are now one of the many tools used by desperate renters in San Francisco. Open houses attract throngs of people, and many come ready with all required documentation in order to sign on the spot. Savvy renters also manage to coordinate a viewing before open houses and fill emails with ample details about their stable income and relationships.

“I’ve heard stories about prospective tenants showing up with champagne and fruit baskets,” said Anne Dahlgren, who moved to San Francisco two years ago and is hoping to move out of her current one-bedroom. “Once I tried to beat the crowd by showing up to an 8am open house on a weekday,” said Dahlgren. “There were already 25 other people waiting outside when I arrived — for a basement studio going for $2,900!” Though Dahlgren was ready to submit an application that morning, the landlord had already received so many offers that she was only accepting bids above the asking rent.

The city’s escalating rents are not only frustrating the city’s new residents. Those who want to upgrade to a better unit are finding that rents have shot up and availability has decreased in just the last two years.

Divya Bhat and her husband currently live in a two-bedroom apartment in Noe Valley (similar to perhaps Cleveland Park) with their two young children and pay $2,900 a month, a rent they locked in 16 months ago. They are now trying to upgrade to a unit with parking, a laundry area and maybe a few more amenities, but a third bedroom is out of reach: for even an improved two-bedroom in a similar neighborhood, they have found that rents are hovering in the $4,200 range.

“When we move out,” Bhat said. “I bet our landlord will re-list our unit at $3,800.”

See other articles related to: trulia trends, trulia, san francisco, rent increase

This article originally published at https://dc.urbanturf.com/articles/blog/champagne_and_signing_bonuses_welcome_to_san_frans_rental_market/5776

DC Real Estate Guides

Short guides to navigating the DC-area real estate market

We've collected all our helpful guides for buying, selling and renting in and around Washington, DC in one place. Visit guides.urbanturf.com or start browsing below!

Northern Virginia

Profiles of 14 neighborhoods across Northern Virginia

Looking to Give People A Reason to Stay Past 6pm
Happily Straddling the Line Between City and Suburb
Columbia Pike
Arlington’s Neglected Stepchild is Getting a Makeover
Crystal City
Turning Lemons into Lemonade
Lyon Village
Developing An Air of Exclusivity?
Hitting Its Growth Spurt
An Urban Village Hitting Its Stride
Del Ray
Virginia’s Small Town Near the Big City
Eisenhower Avenue
The Vibrancy Might Take a Few Years
The Quiet Neighborhood By the Beltway
Old Town
Mayberry By The Potomac
132 Commerical-Free Acres
Downtown Falls Church
Staying the Same in the Midst of Change
Tysons Corner
Radical Change Could Be On The Way

See more Northern Virginia »


Profiles of 14 neighborhoods in suburban Maryland

Small-Town Living in the State Capital
Bedroom Community Gets Buzzing Cache
Cabin John
In With The New While Maintaining the Old
Chevy Chase
Affluence, Green Lawns and Pricey Homes
Downtown Silver Spring
Experiencing a Resurgence After a Bumpy History
A Suburb on Steroids
Rockville Town Square
Despite the Dynamism, Still Somewhat Generic
Takoma Park
More Than a Little Bit Quirky
A Foodie Magnet on the Verge of Change
Capitol Heights
Kudzu, Front Porches and Crime
Glass Half Full or Half Empty?
Mount Rainier
Artists, Affordable Homes and A Silo Full of Corn
National Harbor
A Development Rises Next to the Potomac
Riverdale Park
A Town Looking For Its Identity

See more Maryland »

Northwest DC

30+ neighborhood profiles for the city's biggest quadrant

16th Street Heights
DC's Sleeper Neighborhood
Where (Almost) Everyone Knows Your Name
AU Park
One of DC’s Last Frontiers Before the Suburbs
DC’s Northern Neighborhood on the Cusp
DC’s 535 House Neighborhood
Cathedral Heights
Do You Know Where That Is?
Chevy Chase DC
Not to Be Confused With the Other Chevy Chase
Cleveland Park
Coming Back After A Rough Year
Columbia Heights
DC’s Most Diverse Neighborhood, But For How Long?
An Island of Serenity East of the Park
Dupont Circle
The Best of DC (For a Price)
Foggy Bottom & West End
Where the Institutional Meets the International
Forest Hills
Ambassadors and Adventurous Architecture
Foxhall Village
350 Homes Just West of Georgetown
Friendship Heights
A Shopping Mecca With a Few Places to Live
History, Hoyas and H&M
Glover Park
One of DC’s Preppier and More Family-Friendly Neighborhoods
A Posh View From Embassy Row
LeDroit Park
A Quiet Enclave in the Middle of the City
Logan Circle
Trendy Now, But Not By Accident
Mount Pleasant
Sought-After Homes Surround Main Street in Transition
Mount Vernon Triangle
From Seedy to Sought-After
The Long, Skinny Neighborhood at the City’s Northwest Edge
Park View
It’s Not Petworth
Penn Quarter/Chinatown
DC’s Go-Go-Go Neighborhood
Getting a Vibrancy of Its Own
The Duke’s Former Stomping Ground
Shepherd Park
DC’s Garden of Diversity
Spring Valley
A Suburb With a DC Zip Code
Not To Be Confused With Takoma Park
Not Quite Like Its Neighbors
U Street Corridor
The Difference a Decade Makes
Woodley Park
Deceptively Residential
Adams Morgan
No Longer DC’s Hippest Neighborhood, But Still Loved by Residents

See more Northwest DC »

Southwest DC

The little quadrant that could

Southwest Waterfront
A Neighborhood Where A Change Is Gonna Come

See more Southwest DC »

Northeast DC

Profiles of 10 neighborhoods in NE

New Development Could Shake Up Pastoral Peace
A Little Bit of Country Just Inside the District’s Borders
Not to Be Confused With Bloomingdale
Fort Totten
Five Years Could Make a Big Difference
H Street
A Place To Party, and To Settle Down
The Northeast Neighborhood That Few Know About
Michigan Park
A Newsletter-On-Your-Doorstep Community
Evolving from a Brand to a Neighborhood
Ripe for Investment Right About Now
The Difference 5 Years Makes
Big Houses, A Dusty Commercial Strip and Potential

See more Northeast DC »

Southeast DC

6 neighborhoods from Capitol Hill to East of the River

Capitol Riverfront
Still Growing
Hill East
Capitol Hill’s Lesser Known Neighbor
Congress Heights
Gradually Rising
Notable for Its Neighborliness
Historic Anacostia
Future Promise Breeds Cautious Optimism
Eastern Market
A More European Way of Living

See more Southeast DC »