Sluggish SF rental market

[Sam Josh]

I recently closed on a condo in San Francisco and put it up for rent. The response has been ultra sluggish and slow. Been in the market now 3 weeks with very low inquiry rate. Anyone in the San Francisco market having similar experiences or has any insight on general market conditions? I am hearing there is a seasonal slowdown in rentals and a huge inventory glut. But can’t confirm either.

[Sam Shueh]

There are more people leaving SFBA than arriving. There reason is ridiculous housing cost. Not that many high paid jobs were added.  East Bay- it is common to leave vacant 2-3 months these days.  South Bay it is sluggish since 2016. Saratoga, Campbell, San Jose ditto.  Those approaching me to list are expecting miracles. I kept telling every landlord even if your place is brand new, rent is way lower since 2015. Because people may have purchased in recent years and they focused only on cash flow. For decades if one put 20-35% down it was always negative cash flow for the first few years in SFBA. The only ones enjoyed better returns are the people who bought at 2009-2011 with cash or high down. They get 8-10% cap rate and have a positive cash flow.

This is the time to put in a new bath, new flooring. Your place must standout. Take out old range and put in new appliances, washing machine, driers. Those who really like your place will haggle for a discount. Most look once and turn around. Sometimes they want 20% less than asked for. On apts it is common to advertise 1st month free etc as there appears to be more empty housings today than 2011.