Bay Area Residents Find Reasons to Rent

THIS West Coast city has a new bumper sticker: Renter's Haven. San Francisco has 67 percent renters versus 33 percent homeowners. Department of Labor statistics show that in nine large metropolitan areas the proportion of homeowners ranges from 52 to 66 percent (see table).

And the United States urban average - almost a direct reversal of the San Francisco figures - is 38 percent renters versus 63 percent homeowners.

Economists, urban planners, and the real estate industry are all probing the figures to see whether San Francisco is leading a US big-city trend toward renting.

``What I like about being a renter,'' says Lisa Austin, a San Francisco lawyer, `` is, first of all, the mobility it allows you. Here, with a month-to-month lease, you can pick up and move to any part of town. Beside that, renting as opposed to owning a home leaves a lot more spendable income.''

Nationwide, realtors are not sure renting versus homeowning will increase. ``For one thing,'' points out Orinda, Calif.-based Clark Wallace, past president of the National Association of Realtors, ``the supply of rental units may be shrinking. As a result of the Tax Reform Act of 1986 which removed many building incentives, this supply has become more or less static.'' In addition, Mr. Wallace says, there remains a strong motivating force in American family life toward owning a home.

Although San Francisco has always had a substantial residential share of rental properties, analysts say renting is on the increase. The trend may be due to the skyrocketing prices of homes in the nine-county Bay Area.

Escrow sales median price for the greater Bay Area in February was $261,159. Twenty percent down would be $52,000. Income needed to qualify would be $85,724.

The monthly payment would be $2,143, which includes principal and interest, plus taxes and insurance.

So more San Francisco residents are renting, and for less money than buying. A one bedroom-one bath apartment can be had for $1,000 and up per month; a two bedroom-two bath for $1,500 and up, according to California Association of Realtor figures. Contrasting this outlay in San Francisco with home-buying costs starts a pretty good argument: Is it better to buy or rent?

Some urban housing studies conclude that home purchasing benefits cities and residents.

Analysis here shows that it generates property-tax revenues, ties homeowners to the community, advances pride of ownership, offers tax incentive for payment of home mortgage interest, and builds up investment equity.

On the rental side, city planners in San Francisco have found that some rent by choice on account of lower up-front costs and a lower overall payout for renting than for purchasing.

Renters in San Francisco have as a group demonstrated clout with a capital ``C.''

San Francisco is one of several California cities with residential rent control which limits annual increases to 4 percent in non-landlord-occupied premises.

In addition to that, San Francisco landlords must pay 5 percent annual interest on tenant deposits. The state of California adds another renter incentive: It allows a tax credit of $137 each year for couples renting property for the full 12 months.

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