If your search for an apartment in Fresno is taking longer than usual, there are a few reasons why.
Fresno has a low supply of apartments for rent and little new construction, causing demand and the cost of rent to go up.
A shift in the market has occurred, said Fresno multifamily real estate expert Robin Kane. “You have a limited amount of supply and you have an increasing amount of households forming because the economy is getting better.”
“The built-up demand is massive,” Kane said.
Rents in Fresno have increased steadily over the past 13 months but went up a sharp 6.1 percent in July compared to a year ago at the same time, according to a monthly report from Apartment List, a San Francisco-based online apartment finder. The median rent last month was $810 for a one-bedroom apartment and $1,010 for a two-bedroom.
The rate of increase in Clovis was 9 percent last month. A one-bedroom cost $980 to rent and a two-bedroom cost $1,240. Visalia’s rates were lower at $790 and $1,030 respectively, a 6.5 percent increase year-over-year.
$810 Median monthly rent for one-bedroom in Fresno
$1,010 Median monthly rent for a two-bedroom in Fresno
Carmichael, east of Sacramento, experienced the highest growth in rent at 19.3 percent while rates in San Francisco – the state’s most expensive city to rent – remained unchanged.
It took new Clovis resident Miranda Reid almost a year to find an apartment due to cost and the lack of apartments to meet her needs. Her budget was $750 to $800 a month for a one-bedroom apartment that would also accept her dog.
She started looking around the Blackstone and Nees area. “Once I realized what was available for my price range (my search) changed a little bit,” Reid said.
Reid was living with family in southwest Fresno when she got a job as a receptionist at a local car dealership and decided it was time to live on her own. The rent for the first apartment she saw started at $840 a month. The cheapest was $800. Extra fees for her dog were too high. And popular one-bedroom apartments were hard to find, she said.
“I thought it would be easier,” Reid said.
Fresno is not meeting housing demand, housing experts say. Between 2010 and 2015, only one unit was built for every 3.3 jobs created, according to an analysis by Apartment List. A city should build one new apartment for every two jobs, the report said.
There’s a huge demand and it’s unmet, therefore existing (property) owners have pricing power.
Robin Kane, Fresno multifamily expert
In the 1970s and early 1980s, developers built as many as 2,500 apartment units in Fresno yearly, said Kane, the Fresno expert. That hasn’t happened in the past 25 years, said Kane, who could only recall one or two times over that period where developers built 1,000 units in a year.
If there is demand, why not build?
Rent is increasing, but it’s not high enough to make the cost of a project work for some builders, Kane said. If there are any new developments out there it’s probably because the builder got a tax credit deal or the development is for seniors, he said.
“There’s a huge demand,” Kane said, “and it’s unmet, therefore existing (property) owners have pricing power.”
Reid decided halfway through her search that she needed roommates. She moved into a Clovis townhouse a week ago where she pays $591 toward the $1,250 monthly rent.
“To anyone that is looking, don’t be discouraged,” Reid said. “I was discouraged a lot, like all the time. I gave up so many times. Just keep looking, eventually it will work out.”
Median 1 BR
Median 2 BR
Yearly change in rent
Source: Apartment List