Being a tenant can be great. Each month you pay rent, but don’t have to take care of the little things around a property. Your toilet leaks, call the landlord. The sprinklers aren’t working, call the landlord. The hot water heater quits, call the landlord. You get the idea.
The downside of being a tenant comes when your lease expires and your landlord determines market rent. Are they going to raise the rent? If so, how much? Where will we move?
Rents have historically risen over time. Look at this chart tracking rents from 1986.
Where Are Bay Area Rents Headed?
Which way are San Francisco Bay Area Rents Headed? All indications are that rents will continue to rise in the Bay Area.
Bloomberg.com recently reported that one of the largest single-family landlord is planning on raising rents across the nation. The article indicates that these publicly traded REITs are planning to raise rates 4% on renewals and as much as 5.7% for new tenants.
According to an Associated Press report, rents in San Francisco have jumped almost 15% in the past year. Some rents in downtown Walnut Creek are rising by as much as 35% for longer-term tenants that haven’t seen a renewal in a while.
What can the equivalent of $2,000 per month in rent get you? For high quality borrowers with a 20% down payment, the principal and interest on a loan of $417,000 is approximately $1,960 at 3.875% (excludes taxes and insurance costs).
Are you tired of paying rent and ready to start building equity? Call me at 925.385.8798 to discuss getting your own home.