Los Angeles County's affordable housing crisis has fueled years of debate over how much new housing needs to be built, but a new report from the USC Lusk Center for Real Estate suggests a significant share of the region's remaining affordability exists in its aging apartment stock.
The university's annual State of Los Angeles County Housing and Neighborhoods report found that naturally occurring affordable housing, or NOAH, makes up a substantial portion of the county's rental inventory. Researchers define NOAH as unsubsidized apartment housing that remains relatively affordable compared with newer market-rate properties.
According to the report, apartment buildings built before 2000 account for roughly 75% of Los Angeles County's 1.08 million multifamily rental units in properties with five or more apartments. The largest category, dubbed "Core NOAH," represents 43% of the county's multifamily stock.
The findings underscore how heavily the region relies on older apartment complexes to house middle- and lower-income residents as affordability challenges persist. Even in the county's most affordable NOAH properties, renters spend about 35% of their income on housing, above the 30% threshold used to define rent burden. Countywide, 57% of renters are considered rent burdened, according to the report.
Hollywood and neighboring Studio City emerged as having two of the county's largest concentrations of naturally affordable housing, with approximately 155,000 NOAH units between them accounting for roughly 61% of their rental housing.
"Because subsidized housing cannot be built or scaled quickly enough to replace this stock, preserving NOAH is essential to sustaining what affordability the county's rental market still has," the report said.
Targeting older apartments
The study arrives as investors, housing agencies and nonprofit developers increasingly target older apartment buildings as part of broader affordability strategies.
The Housing Authority of the City of Los Angeles paid about $50 million this year for the 154-unit Emerald Apartments in downtown Los Angeles, continuing a multiyear acquisition campaign aimed at converting market-rate housing into affordable units. Over the past four years, HACLA has acquired more than 40 properties totaling roughly 2,750 apartments.
Private investors have also expanded their focus on aging workforce housing. Los Angeles-based TruAmerica Multifamily has announced plans to invest nearly $2 billion in workforce housing, betting that rising barriers to homeownership will continue to support demand for older, lower-cost apartment complexes.
The USC report points to similar pressures throughout the county. Researchers found a growing share of renter households now earn more than $150,000 annually, suggesting higher-income residents are remaining renters longer as homeownership becomes increasingly difficult to attain.
Homeownership rates have declined across all income groups over the past decade, with middle-income households experiencing the steepest drops. Mortgage demand has also remained historically weak, with fewer applications in the past three years than during the aftermath of the Great Recession, according to the report.
While the report highlighted progress in affordable housing production, including a record year for construction of accessory dwelling units and an increase in the share of new rental units affordable to low-income households, researchers said the county's housing shortage has been decades in the making.
"The county is finally beginning to turn the tide: Investments in affordable rental housing are bearing fruit, and the homelessness crisis appears to have reached an ebb," research director Jared Schachner said in a statement. "But sustaining this momentum and building on it is crucial given the depth and persistence of the county's housing challenges."