California’s Population Is Rebounding. In San Francisco, It’s a Different Story

California’s population is slowly bouncing back after the state experienced an exodus in the two years after the pandemic began, according to recently released state data.

The state had over 100,000 more residents at the beginning of this year compared to last year, the Department of Finance data show. Although the upward trend was seen in most of the state’s largest cities, San Francisco was an outlier.

The city lost more than 3,300 people, the biggest numeric change in population out of every city in California. San José, Vallejo, Milpitas and Redwood City are among other Bay Area cities that saw population losses.

Most Bay Area counties, with the exception of Napa and Sonoma, saw little to no growth in residents, said Walter Schwarm, the state’s chief demographer. Access to housing was a big factor in why some cities grew while others shrank.

“The slight decline in San José’s population could be attributed to individuals looking to move to differing housing/amenities bundles elsewhere in the county, such as Gilroy or Sunnyvale, both of which grew,” he told KQED in an email. “So larger cities facing some slackening of growth is not particularly concerning, rather just a question of housing availability, affordability and market timing.”

The department’s report showed that the state added little new housing to its stock last year. Most of the new homes constructed were single-family homes and granny flats, usually in more suburban cities. The bulk of new apartments, condos and duplexes were built in larger, more metropolitan cities.

Schwarm said the Bay Area’s largely flat growth could also be reflective of the region’s economic slowdown over the past year. Last year, California’s unemployment rate was the highest in the country.

Meanwhile, Los Angeles’ population grew by more than 15,500 people, and San Diego’s by more than 14,000. Other cities, including Fresno, Sacramento, Long Beach and Oakland, also saw growth.

The report released this month used data from January this year and did not reflect major displacement and population shifts from the Los Angeles wildfires that happened later that month.

Counties in the Central Valley and the Inland Empire, including Lassen, Glenn, Fresno and Sutter, saw big population gains, and cities within those counties added more homes.

Sarah Karlinsky, research director of the Terner Center for Housing Innovation at UC Berkeley, said that because land is less expensive there, the housing tends to be more affordable.

During the pandemic, people working in high-cost areas chose to move farther east as they were able to work remotely. While some major companies have started to call workers back into the office, many workers can still work from home and are still choosing homeownership over a short commute into the office, she said.

“They can use that buying power to purchase a single-family home,” she said. “People are seeking more affordable housing options, and if they have the opportunity to work remotely, they’re doing so.”

Other cities saw more population growth as they added more apartments and condos to their housing stock. Los Angeles completed more than 10,000 new apartments, making up about 54% of its total new housing. More than 70% of San Diego’s new homes were apartments or condos. Karlinsky said more housing has been added to the city’s downtown, making it more resilient to economic changes.

“Places that have that mixture [in housing types] are doing better,” she said.

Meanwhile, San Francisco officials are trying to rezone large swaths of its northern and western neighborhoods to make way for more dense housing.

Recently, rent prices have started to rise in the city. Schwarm said that could be a sign of changing tides.

“San Francisco continues to be an outlier facing some challenges,” he said. “However, recent increased rental trends, if spurred by increased demand, would suggest that individuals are moving to the city again.”