Rent Stabilization Board confirms rents on continuous upward trend

Simran Sarin/Staff

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Despite recent contrasting reports from national rental listing sites, rent prices in Berkeley are going up, according to research done by the city Rent Stabilization Board.

On Jan. 1, Apartment List released its national rent report, which revealed a 1.3 percent increase in median rent month by month and a 3.7 percent decrease in median rent year by year for Berkeley. Zumper, another rental listing site, also published a report in late December that found no change in month-by-month median rent prices but a 9.2 percent decrease in median rent for one-bedroom apartments.

The city of Berkeley does not keep data on rents, according to city spokesperson Matthai Chakko. But the rent board, which is independent of Berkeley City Council and the city manager, does track and keep record of rental prices.

Igor Tregub, chair of the Housing Advisory Commission and commissioner on the rent board, said Zumper and Apartment List’s report findings are not consistent with the data collected by the rent board, which found a 7.5 percent increase in year-by-year rent prices.

“I have seen a steady increase in rent pretty much continuously since 1999, when we started tracking the data,” Tregub said. “In fact, the rent increases tended to be more dramatic recently.”

Tregub said a possible reason for the discrepancy is that the rent board gathers data on a sample size of rent-stabilized units, while rental listing sites like Zumper may be including both rent-stabilized and new, market-rate units, which tend to be more expensive.

Newly constructed buildings are not representative of the average rental price in Berkeley and can lead to a “flawed sample” for measuring trends in rent prices, according to Jay Kelekian, executive director of the rent board.

The board’s data reveals that in 2017, the initial market rents for 170 apartment units were 100 to 350 percent higher than the rental rates after stabilization and that 80 percent of these new units experienced vacancies — something Kelekian suggested would lead to the decrease presented in the Zumper and Apartment List reports.

There is a “tremendous” shortage of housing in and around Berkeley, largely because of limited supply and continuous demand, said Bill Falik, adjunct professor at the Haas School of Business.

Falik, who worked in real estate for 45 years and is a member of the Policy Advisory Board of the Fisher Center for Real Estate & Urban Economics, said a downward trend would be surprising.

“It’s a concerted effort to manipulate students into believing there’s no reason to be outraged,” Kelekian said. “If you’re a Cal student, and you’re renting for four years because Cal no longer guarantees housing for first-year students, and you’re renting $14,000 more a year for all four years, that’s an additional $56,000.”

Anjali Shrivastava covers academics and administration. Contact her at [email protected] and follow her on Twitter at @anjalii_shrivas.