While rent prices in most Bay Area cities are increasing, one East Bay city is experiencing a decline. According to data from Apartment List, Oakland’s asking rents have decreased by 10% over the past year.
The data reveals that the median asking rent for a one-bedroom apartment in Oakland was around $2,400 per month in January 2019. By April, this figure had dropped to $1,800 per month.
This significant drop in rent prices has caught the attention of many. A local rental agency in Oakland, City Rentals, has observed this trend. The agency’s owner, Alex Smith, noted that rent prices usually rise in May, but this year the trend in the East Bay is different.
“It’s taking longer, and people are being more selective,” Smith said. “This year has been a bit of a different game and has taken us by surprise.”
Despite the more affordable rents for Oakland apartments this summer, Smith emphasized that location still plays a crucial role. Downtown Oakland, in particular, has seen a notable decline in rent compared to other areas.
“Places that previously had rents at the top of the market have significantly dropped, while areas near the Oakland Zoo or Mills are seeing rent increases,” Smith explained.
Additionally, tenants in Oakland are being offered more incentives. City Rentals, for instance, provides a month of free rent if tenants sign their lease by a certain date. This is partly due to the city’s 2.3 percent rent cap.
“If a place that was rented for $2,400 isn’t finding tenants and you drop the price, it will take years to recover because you can only raise it incrementally unless it’s a single-family home or new construction,” Smith noted.
The data from Apartment List also indicated that the increase in remote work has impacted rent prices. With fewer people working in downtown offices, there is less demand for rentals in downtown Oakland.