Humberto and Maritza Hernandez were stunned when they learned the rent for their two-bedroom apartment in east Santa Rosa would jump nearly 50 percent this month, to $1,450.
And such a rent hike won’t just mean fewer extras for his family, said Humberto Hernandez, a warehouse supervisor with three children. It also ripples out to the local businesses where he no longer will be spending money.
“I don’t think it’s healthy for the economy of the county,” he said.
The dilemma facing the family and other residents of their 10-unit apartment complex offers a glimpse of the turmoil in Sonoma County’s rental market, especially for lower-income families. Significant job growth and a wobbly homebuilding sector have teamed up to create the tightest rental market in decades.
Rents have risen faster in Sonoma County this year than almost anywhere else in the United States, according to several industry surveys. Rents have climbed 30 percent over the past three years in Sonoma County, reaching an average of $1,579 this summer, according to Real Answers, a Novato firm that tracks larger apartment complexes.
The increases are affecting a broad section of Sonoma County, where more than four in 10 families — or 78,000 households — live in apartments or rented homes, according to U.S. Census estimates.
Renters, said Santa Rosa apartment and office developer Hugh Futrell, are “utterly being hammered.”
Landlords say rents are rising because there is a shortage of housing in Sonoma County. Over the past three years, the county has added 18,000 jobs. Since 2008, only about 70 unsubsidized, “market-rate” apartment units have been built, according to Real Answers. As a result, fewer than 3 percent of the county’s apartments are vacant.
“These are the circumstances that we’re stuck with,” said Scott Gerber, a landlord and real estate broker who specializes in apartment properties.
Landlords have become more picky about their tenants, and buyers are purchasing older complexes and making significant renovations. Such developments are discomforting or displacing existing tenants, especially families of limited means.
Matt Schwartz, president and CEO of the nonprofit California Housing Partnership Corp. in San Francisco, said the situation for tenants is bad statewide and “getting worse with each passing day.” In areas with higher-cost housing, he said, “we’re losing income diversity by basically driving out low-income workers.”
But Gerber, a senior vice president for Cassidy Turley in San Rafael, suggested it’s wrong to point fingers at landlords, many of whom continue to charge below- market rates. He contended that the rental market won’t improve until local governments reverse course by cutting development fees and making it less difficult to construct new apartments.
“I talk to people who want to build new units all the time,” he said. The problem in Sonoma County, he said, is “the hurdles are so high that builders just go somewhere else.”
Tenants withhold rent
At the Bennett Valley Townhomes at 4050 Hoen Ave., rents jumped 45 percent in December to $1,450 a month from $1,000 in November after new owners took over the property. In response, tenants — represented by California Rural Legal Assistance and private attorneys — jointly withheld their rents this month. They contend the new owners aren’t entitled to collect the money until they first fix such longstanding health and safety problems as mold and rat infestation, code violations that were documented in a Jan. 21, 2014, letter from the city to the former owners.