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Press Room:
USC Lusk Center Casden Forecast Shows 2010 Apartment Rents Declining in LA and Orange Counties, Rising in San Diego and Staying Flat in the Inland EmpireThe outlook for SoCal apartment markets is mixed this year with rents declining up to 3.5 percent in Los Angeles and Orange counties, staying flat in Riverside and San Bernardino Counties... April 07, 2010
LOS ANGELES (Business Wire)- The outlook for SoCal apartment markets is mixed this year with rents declining up to 3.5 percent in Los Angeles and Orange counties, staying flat in Riverside and San Bernardino Counties, but inching upwards thanks to a better employment outlook in San Diego County, according to the latest Casden Real Estate Economics Forecast from the University of Southern California Lusk Center for Real Estate. "Overall, Southern California will not see sustained increases in rents until the greater economic health of the region improves, but renters in San Diego may experience the kind of slight increase that comes when jobs return and housing is still too costly for renters to become buyers," said Tracey Seslen, Ph.D., co-author of this year's Casden Multifamily Market Forecast. The future health of the Southern California multifamily market continues to be shaped by jobs, housing prices, the "shadow" market of rental homes and condos, and new construction, Seslen explained. While housing prices have dropped precipitously due to the surging rate of foreclosures in the Inland Empire region of Riverside and San Bernardino counties, the low-cost homes are being snapped up by all-cash buyers, not renters, who often lack 20-percent down payments and the income needed to qualify for a mortgage, according to Richard K. Green, Ph.D., director of the USC Lusk Center and co-author of the Casden Forecast. "Housing is more affordable across the region, but low consumer confidence is keeping many first-time buyers on the fence and move-up buyers that lost equity are staying put. That opens the door for an increase in rents," he added. Los Angeles County is another matter: the unemployment rate hovers at 12.3 percent and plenty of inventory stands empty thanks to new luxury condos being turned into rentals. In Orange County, average rents will decline at a slower pace and new projects in Anaheim and Irvine will continue to attract renters priced out of the housing market. San Diego will outperform the other SoCal markets in rental and vacancy rates as a steady stream of defense contracts and strong growth in the biotech industry buoy the region's economy. The Casden Multifamily Market Forecast analyzes new building permits, leasing activity and employment data using information from MP/F YieldStar, Hanley Wood and other sources. A complete summary of the 2010 Casden Multifamily Market Forecast can be found online April 9, 2010 at www.usc.edu/casden. Some highlights from this year's report: |
