Bay Area renters strug­gle with cost

About half are eco­nom­i­cally bur­dened, spend over 30 per­cent of in­come on rent

The Mercury News Weekend - - FRONT PAGE - By Louis Hansen lhansen@ba­yare­anews­group.com

Nearly half the renters in the Bay Area strug­gle to meet high hous­ing costs, de­spite an in­flux of wealth­ier work­ers into the mar­ket, a new sur­vey found.

A study by Apart­ment List, a rental web­site, found nearly 1 in 4 renters in San Jose, San Fran­cisco, Oakland and sur­round­ing ar­eas were se­verely cost bur­dened, spend­ing more than half of their in­come on rent. About half of Bay Area renters are con­sid­ered eco­nom­i­cally bur­dened, spend­ing over 30 per­cent of their pay­checks on shel­ter.

But the re­gion’s record­set­ting hous­ing prices are forc­ing high wage earn­ers into the rental­mar­ket, too. Real es­tate agents and re­searchers say wealth­ier clients in the Bay Area are choos­ing to rent be­cause they can’t af­ford to buy. Even well-paid young tech work­ers are find­ing it hard to break into a hous­ing mar­ket where the me-

dian sin­gle fam­ily home price is $775,000.

“Rents are out of con­trol. Ev­ery­body knows that,” said David Hunt, op­er­a­tions man­ager for prop­erty man­age­ment com­pany WA Krauss. But few prospec­tive renters have trou­ble meet­ing in­come qual­i­fi­ca­tions for their 450 rental prop­er­ties around the Bay Area, Hunt said.

“There’s a lot of money here,” he said.

San Jose is one of a hand­ful of cities across the coun­try see­ing more cost-bur­dened renters over the last decade, said Syd­ney Ben­net, re­searcher at Apart­ment List and au­thor of the study. “San Jose is re­ally feeling the im­pact of the rent crunch,” she said.

Av­er­age rents have con­tin­ued to surge, grow­ing up to five per­cent over the past year in some cities. In San Jose, a one-bed­room goes for $2,050 and two bed­room for $2,570. In Oakland, the typ­i­cal one bed- room costs $1,780 and a two-bed­room costs $2,240. And in San Fran­cisco, the av­er­age rents are $2,450 for a one-bed­room and $3,080 for a two-bed­room, ac­cord­ing to Apart­ment List.

The sur­vey is the lat­est to spot­light the hous­ing pinch on renters in Sil­i­con Val­ley. Re­searchers at UCLA found that nearly 80 per­cent of res­i­dents in the San Fran­cisco metro area earn­ing un­der $50,000 are spend­ing­more than 30 per­cent of their in­come on rent.

The Apart­ment List study con­sid­ered in­come and rental costs when cal­cu­lat­ing an in­dex of af­ford­abil­ity. Among the top 100 metro ar­eas in the coun­try, San Jose was ranked at 51 and San Fran­cisco at 30 for af­ford­abil­ity, re­flect­ing the Bay Area’s strong econ­omy and higher salaries.

But that doesn’t tell the whole story, Ben­net said. Lower in­come renters have been forced to leave the re­gion for cheaper cities and states, she said. Oth­ers are leav­ing apart­ments to re­turn to fam­ily homes.

Cal­i­for­nia and Florida have the high­est per­cent- age of renters pay­ing more than 30 per­cent of their pay­checks for shel­ter. Los Angeles and Mi­ami ranked near the bot­tom of the in­dex for af­ford­abil­ity.

The study also found the share of cost-bur­dened renters has soared over gen­er­a­tions. Just one- quar­ter of U.S. res­i­dents paid more than one-third of their in­come to rent in 1960; that per­cent­age is now nearly 50 per­cent.

Among the most af­ford­able places to live in­clude Og­den, Utah; Pitts­burgh and Kansas City, ac­cord­ing to the sur­vey. Sev­eral Cal­i­for­nia cities were deemed the least af­ford­able for rent- ers, in­clud­ing strug­gling metro ar­eas of Ox­nard and Fresno.

Jeff Bar­nett, vice pres­i­dent of Alain Pinel Real­tors, said the Bay Area rental mar­ket has flat­tened out re­cently, but still stretches the bud­gets of many new res­i­dents. Rental prices are so high, he said, that some fam­i­lies may be bet­ter off reach­ing a bit to buy a starter home or condo.

“You have to be a lit­tle more cre­ative, and save a lit­tle more money,” Bar­nett said. “It’s one of the most beau­ti­ful places in the world, but we pay for it.”

JOSIE LEPE — STAFF AR­CHIVES

San Jose, where the 808West Apart­ments are be­ing built, ranked 51st in nationwide af­ford­abil­ity for renters.

PA­TRICK TEHAN — STAFF AR­CHIVES

San Jose, home to Cen­terra lux­ury apart­ments, is see­ing more cost-bur­dened renters.

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