Therese Fitzgerald With strong job growth and population gains and some of the highest home prices in the nation, Southern California's apartment market is robust. "You have occupancy that exceeds 95 percent everywhere and, in most areas, exceeds 97 percent," said Delores Conway, director of the USC Lusk Center's Casden Real Estate Economics Forecast, "and annual rent increases of 3 to 8 percent, where the national average is 2 percent." "The investment market cap rates are quite low and lots of people are trying to buy," said Conway. San Diego has already started to see a real cooling off of its once red-hot condo market. "People still very much want to live in San Diego, but the price appreciation has slowed," said Conway. "There have not been as many conversions as there were 18 months ago." "Even if you seal the borders," Conway noted, "millions of people will still occupy housing in Southern California."
February 1, 2006