Santa Rosa Rental Market Update: What Does It Mean for Your Property?

How are you feeling about the performance of your rental properties in the Santa Rosa market?

We all know that this part of California is unique. And while there might be a lot of attention-grabbing news (good and bad) about how things look in California and nationwide, we know that real estate is extremely local. Especially when we’re talking about the rental market. 

If you own rental housing in Santa Rosa, 2025 has been a year of modest rent recalibration, continued rebuilding and new construction, and a fast-moving regulatory and insurance backdrop. We have a lot of investors and property owners asking us about whether we should feel good about things, and where we see the market going. So, we’ve put together our take on the Santa Rosa rental market and what you can do to best position your investment properties for the next 12–18 months.

Quick Overview: Median rents for all unit types in Santa Rosa are down about 1.4% from last year and just barely up month-over-month. In general, average rents seem to hover around $2,500, and they are showing small monthly and yearly increases depending on neighborhood and property type. Insurance is more expensive and more difficult to get thanks to risk and high-cost claims. Pricing, leasing, and retention require owner attention and focus in a shifting market. Adding value such as smart home tech and energy efficient upgrades will establish a competitive advantage. Tenants are looking for flexibility and convenience. Providing it attracts and retains good residents.

Rents and the Santa Rosa Market 

Rents are essentially flat to slightly down, but that was to be expected after so much surge over the last five years 

There are a number of factors that can explain why rents have stopped their upward trajectory and stabilized into a plateau of between $2,200 and $2,800, depending on property type, condition, and neighborhood.  Here’s what we think is especially impactful:

1. New construction supply is finally hitting the market. We’ve seen some new, higher-amenity rental homes reaching the market, increasing competition for top-tier renters. These are more expensive rentals, but they’re providing modern appliances, amenities such as gyms and pools, and move-in specials that attract tenants quickly.
2. Renters are showing renewed price sensitivity after several inflationary years and a lot of frustration around rising home prices, in both the sales and rental markets.

Renters arriving on the market can find downtown apartment projects offering studios and one-bedrooms near the SMART rail corridor. While not enough to flood the market, new buildings like this raise the bar on amenities and can temporarily put pressure on nearby rentals. Your property has to be prepared to compete in order to attract and retain good renters. 

Insurance and Santa Rosa Rental Owners 

The property insurance market in California remains challenging, and that’s having an impact on your operational costs as a rental property owner. 

State regulators have been working to stabilize coverage availability through measures like FAIR Plan expansions and allowing insurers to pass through reinsurance costs. While these changes aim to improve access, they can also contribute to higher premiums in the short term.

Large insurers are still adjusting their wildfire exposure in the state. Rental property owners need to be prepared for continued premium pressure, even as availability slowly improves. Documenting mitigation measures at your property, such as defensible space, hardened roofing, and ember-resistant vents, can help during underwriting and may qualify you for discounts.

Budget appropriately for insurance and operating expenses over the next year or two. This is a good time to review your own coverage and disaster plan, too. Natural disasters are always top of mind, especially in Santa Rosa, which is still recovering from the Tubbs Fire in 2017.

Pricing, Leasing, and Retention in Santa Rosa’s Rental Market

On a high level, we see that there are challenges to owning investment property right now, thanks to high costs and new competition. All of that is manageable, however, especially if you have some good systems in place and you’re willing to both stick to your plan and leave some room for flexibility if you need to adapt quickly. 

We’re encouraging owners to look at pricing, leasing, and retention when it comes to responding to market changes. 

• Price Your Property for Faster Leasing

With rents holding steady, overpricing can lead to extended vacancies. This is going to be costly, so be mindful of finding a well-qualified tenant quickly with the rental value that’s attached to your property. Price within 1–2% of recent comparable rentals and prioritize speed to lease. Even a small discount can be recouped by avoiding extra vacant days. Talk to us about the Santa Rosa rental values in your neighborhood. We can provide some data and insights that will ensure you’re not overpricing or underpricing your rental property. 

• Incentivize Leasing and Retention 

If you need to compete with newer buildings offering move-in specials, consider micro-incentives like a professional cleaning credit or pet fee waiver instead of a full month’s free rent. This is especially beneficial when you’re negotiating a lease renewal that may come with a slight rental increase. You don’t want to give your tenants a good reason to leave, so offer them a good reason to stay.

• Highlight your Property’s Unique Advantages

Older neighborhoods may offer features newer complexes can’t match, such as quiet streets, private yards, garage parking, or larger floor plans. Showcase these in your marketing. Make sure you’re establishing yourself as a great alternative to those new apartment buildings. 

• Provide a Pet-Friendly Property in Santa Rosa

Allowing pets is really becoming more and more of a non-negotiable as a landlord. Such a large majority of the tenant pool is made up of pet owners. Why limit your potential residents by saying a hard no to dogs and cats? There is extra risk when you welcome pets, but clear pet policies with reasonable pet fees and requirements can help reduce that risk. Allowing pets also cuts down on vacancy time, as many renters struggle to find pet-friendly housing.

Adding Value with Upgrades that Matter

If you’re turning your Santa Rosa rental property over, and you’re thinking about ways to ensure you’re attracting the highest rents and the best tenants, you’ll want to pay attention to market trends when it comes to upgrades and updates. Two specific things are more likely than others to establish a competitive advantage for your property. 

1.Smart Home Technology

All of those new construction properties we talked about are offering features like smart thermostats, keyless entry systems, and app-controlled lighting or security cameras. Your property has to offer those things too, if you want to compete. Tenants appreciate the convenience and efficiency these systems provide, especially in a city where many residents commute to jobs in the Bay Area or along the SMART rail corridor and value the ability to manage their homes remotely.

Smart thermostats can help renters control energy use during hot summer days or cooler winter nights, lowering utility costs while supporting sustainability, which is a priority for many in Sonoma County. Keyless entry eliminates the hassle of lost keys, offers flexible access for service providers, and enhances security. Smart security systems and video doorbells add peace of mind, which is particularly appealing to families and professionals.

For property owners in Santa Rosa, these upgrades are relatively low-cost compared to other renovations, can often justify modest rent increases, and may even reduce insurance premiums. In a competitive but stable rental market like Santa Rosa’s, smart home features provide a modern edge that boosts marketability, tenant satisfaction, and long-term return on investment.

2. Energy-Efficient Updates

Energy-efficient upgrades like LED lighting, modern ENERGY STAR® appliances, and low-flow water fixtures can deliver big benefits in the Santa Rosa rental market. These improvements appeal to tenants who value sustainability and want to reduce their utility bills, which is an increasingly common priority in the current market. A simple switch to LED lighting offers long-lasting brightness while cutting electricity costs, and updated appliances provide better performance with less energy use. Low-flow showerheads, faucets, and toilets conserve water, an important consideration in a region that experiences periodic droughts and water restrictions.

For property owners, these upgrades can increase a rental’s appeal, support modest rent increases, and reduce maintenance costs over time. They also demonstrate environmental responsibility, which can help attract long-term tenants aligned with those values. In a rental market as competitive as the current one, energy-efficient features are an easy way to stand out, improve tenant satisfaction, and protect your investment while contributing positively to the local community and environment.

Here’s the takeaway we can provide as experienced property managers and real estate experts in Santa Rosa: the rental market is balanced. Rents are stable, competition is strongest near new supply, and long-term fundamentals remain solid thanks to an ongoing housing shortage and steady demand. 

Owners who focus on accurate pricing, retention, and proactive maintenance will be best positioned to succeed in the months ahead. Let’s talk about this in reference to your own portfolio. Please contact us at Prestige Real Estate & Property Management. We manage homes in Sonoma County, including Santa Rosa, Windsor, Sebastopol, Petaluma, and Rohnert Park.