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A comment on San Francisco Apartment Rents Crater Up to 31%, Most in U.S.. Parent comment

Re:San Francisco Apartment Rents Crater Up to 31%, Most in U.S. by matchbok on Tuesday October 13, 2020 @07:51PM (#24771694)
The price is mostly the land underneath it. Fancy countertops don't make rent go high.
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Re:San Francisco Apartment Rents Crater Up to 31%, Most in U.S. by kelnos on Wednesday October 14, 2020 @12:53AM (#24773199)
No, but SF's byzantine planning and approval process jacks up the total cost to build to the point where it doesn't make financial sense to build low-end housing. That means the developer has to increase sale prices in order to turn a profit, which in turn means new landlords need to charge more rent to just break even.

If you consider that a newly constructed 750 sqft 1BR apartment can easily run $800k-$1M, a buyer is looking at $4-5k per month to cover the mortgage, property taxes, insurance, HOA, maintenance, etc. Do you really think a buyer is going to turn around and rent it out for $2k/mo?

For buildings wholly owned by a leasing company, the economics are better, but still not to the point where they're going to rent that out for under $3-4k/mo.

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