Vacancy rates are at an amazing rate of 3%
Rental Market Softening
The average price for an apartment in Los Angeles County hit $1,471 in the second quarter. In Orange County it reached $1,611. That’s an increase in both places The problem is that without stronger job and income growth, the Southland rental market may be topping out.
In fact, when adjusted for inflation, median household income in Southern California has fallen 11% since 2007. Even though Southern California has regained most of the jobs it lost in the recession, wage growth has been weak, especially for lower-income households that are more likely to rent.
Buy and hold is still a good strategy in today’s market. The truth is that the any new apt buildings are aimed at higher priced rentals so if you have units and homes priced in the lower end, you should be fine. Tight credit and the lack of rising income will also keep people renting for a long time.
Meanwhile, housing prices, both to rent and to buy, have surged over the last two years. Already, 33% of Southland renters spend at least half their income on monthly rent
