In the West, real estate prices are down but rents are up

Just because it’s a bad time to own a home doesn’t mean that it’s a good time to be a renter.

While homeowners fret about the crumbling value of their properties, apartment renters throughout the western United States are writing bigger checks to pay for their leases, according to a report to be released Thursday.

The average apartment rent through March rose from the previous year in all 19 major western markets surveyed by the research firm RealFacts, with the increases ranging from less than 1% in Reno to more than 9% in the San Francisco Bay Area and Salt Lake City.

Meanwhile, home prices have plunged 10% to 30% in many markets in the region, leaving owners feeling poorer and, in the worst cases, so distressed that they decide to stop paying their mortgages because they owe more than the properties are worth.

San Jose – situated at the heart of Silicon Valley – is now the West’s most expensive rental market. The average apartment there leases for $1,660 a month, up 9.1%, or $139, from the same time last year.

That means a Silicon Valley renter can expect to pay nearly $20,000 to lease an average apartment during the next year.

The current cost to rent a Silicon Valley apartment is still well below the peak of $1,959 a month – about $23,500 annually – reached in early 2001, when the dot-com boom was winding down.

Average apartment rents also are above $1,500 a month in three other California markets tracked by RealFacts: Los Angeles and Orange counties ($1,651, up 4%), San Francisco/Oakland ($1,596, up 9.4%) and Ventura County ($1,552, up 1.8%).

The West’s most expensive rental market outside California remains Seattle, where the average apartment lease climbed 8.5% year over year to $1,090 a month.

Tucson offers the West’s least-expensive apartments, with rents creeping up 2% to $668 a month.