Conversely, if you're a building manager and you an X% occupancy rate target, you're going to need to cut prices in order to maintain that rate if a bunch of tenants don't renew.
This is pretty much textbook microeconomics 101.
Going a bit further, occupancy rate is a signal that both sides of the market can (noisily) observe, so if the prior non-occupancy rate was very low, you'd expect a shock that doubles the rate (say, 5% -> 10%) to lead to perhaps a larger price change than in a less tight market (such as 10% -> 15%)
The premise I was responding to is that noting change in inventory will show much larger swings if there's relatively few units on the market, and that may be a poor indicator of what's going on.
Simplified, it's the difference between a market of 100 units of this 10 are avaiable inventory, and seeing an increase of 3 units (30% raise in available inventory) and a a market of 100 units that has 1 unit available and sees an increase of 2 units (200% increase in available inventory). There was an increase in inventory, and it helps, but probably not as much as 200% would lead one to believe.
The article itself noted the latter was the case in SF as there was "unusually low inventory" compared to other cities beforehand. Of course the difference is going to look outsized, in that case.
> if the prior non-occupancy rate was very low, you'd expect a shock that doubles the rate (say, 5% -> 10%) to lead to perhaps a larger price change than in a less tight market (such as 10% -> 15%)
That depends on so many other factors that I think you can't easily generalize like that for housing. If the inventory is still very low, and now instead of being uber-rich you just need to be very-rich, you're still so constrained in your potential customers that the price range may not change significantly, or if you're still catering to a class of people that do or don't traditionally commute, or if the price is hovering near the break even for a lot of people for commuting vs living local, or whether the work in the area that many of the potential customers does can be done remotely (as these articles are about), etc. Housing is one of the most complicated markets, and there are numerous counterexamples of the exact opposite happening to what you describe
One example, it makes more sense to give someone 3-6 months free at price $X than to get them in at .5 or .75 $X.
It depends on the landlord. If they were reasonable, then yes, I'd bargain with them. If they were total pricks for most of the time I was there, then screw them. I can get my lower rent and hurt them in the process. I'll try that option! (At least, I bet that's the thinking of many people.)
That said, a lot of folks in SF are on month-to-month leases so they can just give a 30-day notice and peace out.
> It should be noted that San Francisco had an unusually low inventory relative to other large cities prior to the pandemic. Historically, the ratio of homes for sale relative to total housing has been a quarter of New York's.
But then they go on to assert that this is important regardless, but don't actually provide any information to back it up.
> Regardless, the 96% year on year change in inventory marks a significant moment.
I would assume if it was so self evident, it would be easy for them to include even a sentence that alludes as to why.
They say other nearby markets don't see the same shift but other nearby markets were never like SF anyway, so I'm not sure why they would indicate something in a market already known to be dissimilar.
Edit: I and the parent comment were referring to the SFGate article from another submission that got merged I to this one, as we were before the merge.