FRESNO, Calif. (KSEE) – Rent prices continue to rise in Fresno faster than any other city in the state of California.
New data released by Apartment List shows Fresno has had a 23.1% rent increase over the last 12 months which is well above the state of California (11.6%) and U.S. (15.1%) rent increases. The average one-bedroom apartment now costs $1,150.
Greg Terzakis from the California Apartment Association says it’s all about supply and demand, with Fresno seeing an influx of people moving to the Valley during the pandemic.
“Since so many companies have allowed work from home or made it a permanent policy, people have decided they’d rather move to a place where they can afford an apartment and not have to worry about how much of their paycheck is being spent on that apartment,” he said.
It’s not just apartments that are rising in price. Redfin reports Fresno home prices in September were up 12.9% compared to last year, selling for a median price of $350k. It’s an increase Terzakis says makes the demand for apartments even higher, as it forces more people to continue renting instead of buying a home.
“People who were renting in anticipation of buying a home are still renting because the housing prices have gone up so much; the house they wanted to buy a year ago is 20% more than it was,” he said.
Terzakis says he believes the market will hit a plateau soon, but the only way to avoid more rent increases in the future is to build more housing.
“For the last 25 years, California has not been building nearly enough housing, both for market-rate and affordable. We need to build our way out of this,” he said.
There are limits to how much a landlord in California can increase rent. Every rental property that is not exempt from AB 1482 can only have an annual rent increase of 5% plus the annual Consumer Price Index (CPI) percentage change.