Slow and steady gains in the overall Southern California economy will continue to push up apartment rents and occupancy rates that now rank among the highest in the country, according to the Casden Real Estate Economics Forecast released by the University of Southern California Lusk Center for Real Estate.
Overall, almost 97% of apartments in Los Angeles, Orange, Riverside and San Bernardino counties are currently rented and those occupancy rates should remain steady this year. Rent increases of 6% to 7% can be expected in Los Angeles where the average monthly rent at the end of last year was $1,416. Orange County renters also can expect a rent hike of 6% to 7% beyond the average monthly rent of $1,390. Inland Empire rents, which averaged $1,012 per month at the end of 2005, should rise about 5% in 2006, the center said.
"The recent run-up in home prices makes apartment living more desirable," said Delores Conway, director of the Casden Forecast, which analyzes apartment transactions, new building permits, leasing activity and employment data using information from MP/F YieldStar, Property & Portfolio Research and other sources.