Berkeley’s rent prices continue to climb while apartment rates decrease nationally, according to a report from ABODO, an apartment listing website.
Berkeley saw the fifth-highest increase in the nation in median rents for two-bedroom apartments in March, while Oakland experienced the tenth-highest decrease.
“Sometimes it’s a simple game of supply and demand,” said ABODO spokesperson Sam Radbil.
The report uses more than a million ABODO listings across the United States to calculate rent prices and track the month-to-month percent change.
Apartment development across the nation is growing, Radbil said, with construction at its highest levels since the 1980s. This is increasing the supply of apartments and driving down prices.
The supply of apartments in Berkeley, however, is not able to meet the hefty demand, according to Berkeley Zoning Adjustments Board chair Igor Tregub.
Berkeley’s limited space available for apartment development could be one factor in the disparity between Berkeley and Oakland’s apartment rates, Tregub said. Oakland has some open space that Berkeley does not, allowing for additional development on the margins of the city.
Nationally, median one-bedroom rents in March are set to decrease 0.8 percent, according to the report. This follows another national rent decrease in February 2018, which ended a previous five-month streak of rent raises that began in August 2017.
In 2017, national rent increases began in April and continued for most of the year, according to the report. Radbil said 2017 saw an abundance of development but that few apartments were ready for the market at the time.
Among Berkeley’s new apartments, more expensive units outnumber less-expensive, below-market-rate units by a ratio of nearly 10-to-1, Tregub said. This is far below the regional goal for below-market-rate units, according to Tregub.
“This is a pattern we’re seeing all over the Bay Area,” Tregub said.
People are also moving from urban centers such as Oakland or San Francisco to more suburban areas such as Berkeley, according to Radbil, increasing demand for apartments in Berkeley.
Many people, primarily driven by the Bay Area’s technology industry, are moving into Berkeley apartments and taking up the supply, according to Tregub. As this happens, there is a pattern of displacing existing tenants who cannot afford the rising prices, Tregub said.
Many Berkeley tenants are one check away from losing their housing, Tregub added.
Radbil said suburban areas, such as Berkeley, might see increased development in response to the surge in demand.
“Developers know where the traffic’s going,” Radbil said.