San Francisco Apartment Rent Recovery

San Francisco investment properties are bottoming. According to Jay Greenberg, in an SFAA magazine article, San Francisco has seen positive sales numbers this year. Rent rates have also been getting stronger in the city. Im a firm believer that well paying jobs and the reverse commute busses provided by the tech sector, are a big part of why rentals are up and property is on the rebound.

Greenberg points out that interest rates are low, rent rates are increasing and cash flows are improving. Following is a synopsis of Greenbergs review of apartment sales:
Chart Source National Real estate Investor

5-9 units

The slide in this sector seems to have stabilized. Price per sqft is $271 this year vs. $376 in 2008. Deal flow for the first three quarters of 2010 is 61 compared to 57 in 2008.

10 Plus
Average price per sqft in 2010 is $256 donw from $347 in 2008. The good news here is that the deal flow has increased to 65 for the first three quarters up from 32 last year.

The San Francisco apartment sector is benefiting from pent-up demand, declining homeownership, and a limited supply of new development. Nationally, 70 million potential renters, the echo boomers, are expected to enter the renter pool for apartments. Something like 3.2 million renters, aged 20-34, will be looking for a place to rent between now and 2012.

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