Southern California apartment rents are expected to keep falling
Los Angeles Times
By Alejandro Lazo
...Southern California's high number of foreclosures and the rampant overbuilding during the housing bubble has resulted in a glut of rentals as demand has slackened with high unemployment, according to the Casden Real Estate Economics Forecast. Meantime, many struggling young adults have moved back in with their parents, and older people who have lost their homes have started living with relatives, according to a separate study for the Mortgage Bankers Assn.
That study -- by Gary Painter, a professor in USC's School of Policy, Planning and Development -- found that a net 1.2 million American households disappeared from 2005 to 2008. While rents are likely to fall 3.5% in Los Angeles County and 2.4% in Orange County, those declines are expected to be more moderate than in 2009. Rents should fall less than 1% in Riverside and San Bernardino counties but inch up less than 1% in San Diego County, according to the Lusk Center study.
"The take-away is that the economy is showing some small signs of improvement. All markets are going to perform better than the previous year, but for some that still means a decline," said Tracey Seslen, a professor at the USC Lusk Center for Real Estate who co-wrote the Casden study. "L.A. is going to perform the worst." In Los Angeles County, the average monthly rent fell to $1,488 at the end of 2009, a 5.8% decline from a year earlier...