The average rent in March 2002 was $1691, down from $1738 in December 2001, according to the report. That represents a drop of more than 2% in a single quarter. Over the past year, the drop has been about 15%. Rents have not been this low since early 2000, according to the report.
The good news is that the rate of decline is slowing. According to the report, if the rate of rent decline continues for the rest of the year at its present rate, the annual decline for 2002 would be only 8%--half the rate of decline in 2001. As well, the survey found that occupancy actually rose by two tenths of a percent, from 93.5% in December to 93.7% in March.
"These new figures suggest that the market in San Francisco will soon bottom out," concludes the report. "With unemployment starting to drop slightly, tourism beginning to rebound, and some of the glut of office space slowly subleasing, the San Francisco economy is starting to move forward albeit at a leisurely pace.
"And of course, even the "low" rents of the present are higher than landlords in most cities could dream of. A nice two-bedroom apartment will still cost the resident about $2000 a month, and to add a third bedroom will cost an additional $500 each month."
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