According to a report on the country’s rental market from real estate firm Marcus & Millichap, Los Angeles is at the top of its 2017 National Multifamily Index. They predict that this year, Los Angeles Rent will rise more than five percent while the city’s low vacancy rate continues to decline.
While this may be good news for landlords, it’s not for renters. The report reveals that Los Angeles rent prices are likely to rise to an average of $2,095 per month by the end of 2017.
But how did this happen? According to Curbed Los Angeles, “The sizable price bump is mainly attributable to a predicted dip in the vacancy rate to just 2.6 percent. Moreover, new housing isn’t being constructed quickly enough to replace existing units that are filling up.”
This report also reveals that around 10,900 multifamily units are expected to be added to the market in 2017 which is about 2,000 less than last year. Construction in Los Angeles has been at a slow pace in the recent years and will slow down even more if the Measure S ballot measure is approved on March 7. This measure would put a two-year moratorium on large-scale projects.
Apartment listing site Zumper released their February National Rent Report and found that monthly rents have already increased by .5 percent for one bedroom units and .7 percent for 2-bedroom units. The median price for 2-bedroom units is at $2,900.
“Los Angeles climbed a spot in our national ranking, outpacing D.C., to become the sixth most expensive rental market in the nation,” Zumper spokeswoman Crystal Chen said via email.
According to LA Weekly, “While those month-to-month increases might seem tiny, the annual median rent increase for an L.A. two-bedroom was 7 percent compared with January 2016, the site found. Three of the top 10 cities with the highest median one-bedroom rents, including No. 1 San Francisco, are in California.”