April 18, 2023

SoCal 4Q22 Multifamily Market Insights: Tight conditions, continued rent growth throughout the region

Highlights:

Property performance metrics in Southern California generally improved in 2022. Asking rents rose at rapid rates and vacancies tightened. Modest levels of new construction are anticipated in 2023, representing a minimal increase to the region’s overall inventory levels.
While the vacancy rate inched higher across the region during 4Q22, the rate improved for the year. In 2022, the average vacancy in Southern California fell 40 basis points to 3.4 percent.
Southern California posted significant rent gains in 2022, with average rents increasing 11.6
percent. Greater Los Angeles led the region in rent growth, posting a 15 percent increase.
Total sales activity in 2022 fell 20 percent from levels recorded in 2021. The median sales price during the past 12 months was $335,000 per unit, up 14 percent from the median price in 2021. Cap rates inched higher, but were among the lowest in the country in 2022.