Short Analysis of Bay Area Peninsula Rental Market

Recently, I moved my family from Utah to the Bay Area for my new job at Mozilla. It’s a homecoming for me; I grew up in the East Bay. To keep my commute times down, we decided to rent a place on the west side of the San Francisco Bay, called simply “the Peninsula”.

As with most major metro areas, the best way to find a rental these days is on Craigslist. In my searching for housing, I thought it would be interesting to analyze the listings on Craigslist to get a feel for the differing rental prices of each of the various Peninsula cities. Because I’ve got quite a few kids, I didn’t bother looking at listings with less than three bedrooms.

As I did my analysis, I worked out the average price of rentals with at least 3 bedrooms in all of the major areas of the Peninsula that Craigslist covers; here’s the data as of November 2008 in graph form:

One problem with this approach is that it combines rental units with different numbers of bedrooms; here’s a graph with the price of the rental divided by the number of bedrooms:

For a little context, it might also be helpful to share the total number of rentals by area:

Declining Rental Prices?

Out of curiosity, I decided to re-run the analysis on the rental market as of last week. No surprise, there was a general mild decline across the entire peninsula. In terms of rent, the combined average went from $3,562 to $3,500 (~1.75%); by room, that’s $1,046 down to $1,019 (~2.5%).

You can see that the characteristics of each area is quite different:

Note that I had to leave out a few areas where there simply wasn’t enough data to compare; I probably should have thrown out Atherton, Portola Valley, and Woodside as the number of listings was few and their prices varied greatly, as you can see from the graphs.

Obviously, to draw any real conclusions from this data, I’d need to do more work to extract duplicate listings (folks often re-list the same property before a listing expires to keep it at the top), include 1 and 2 bedroom properties, and look at the data for a longer period of time.

Still, it is relatively safe to say that there is a very small price decline, but it is probably just as likely to be explained by the slower winter market than the macro-economic conditions.

I’m going to keep capturing data periodically and analyzing it, and if I see any interesting trends, will post again.