Two new reports highlighted the squeeze renters are now feeling in America’s top priciest metros. In New York, dnainfo.com cited a monthly StreetEasy report released Monday that said asking prices for new Manhattan apartments jumped 12.4 percent over the past year. It also said inventory fell by 8 percent over the past year.
On the other side of the country, a vibrant tech market is filling up apartments in Silicon Valley and pushing renters into The East Bay, where rents are now going up. MercuryNews.com highlighted one woman who had been looking looking for an apartment in The East Bay for six months without success. It cites Marcus & Millichap stats that show vacancies in Silicon Valley will drop below 3 percent and rents will hit $1,522 per month (more than a 7 percent increase from 2011). For San Francisco and the Peninsula, the company forecasts a 7.2 percent increase to $1,947 a month, according to the MercuryNews.com.
The paper attributes the housing shortage to a surge in tech hiring, homeowners continuing to rent, and Gen Yers moving out on their own (presumably with these new jobs). It’s basically the perfect storm for landlords. But is it too much of a good thing? Renters waiting six months to find rental housing, ultimately, isn’t good for anyone. Newspaper articles start focusing on those people who can’t find places to live and the exorbitant prices people who do have apartments are paying. Local governments take notice. And, steps are taken to regulate landlords. So the question is: are these sort of rent increases (and occupancy tightening) going for the industry on a long-term basis?