Greater Los Angeles Q1 Multifamily Market Report: Steady Renter Demand Fuels Tightening Vacancy and Rising Rents
Highlights:
- The Greater Los Angeles apartment market benefited from steady renter demand and a slowdown in supply growth during the first quarter. Deliveries slowed, but the development pipeline is quite full, and developers are likely to bring thousands of new units to the market by the end of this year.
- The vacancy rate in Los Angeles County has remained in a very tight range for the past several years and stability is likely to persist in the coming quarters. The rate fell 10 basis points in the first quarter reaching 3.6 percent. Year over year, vacancy is up 10 basis points.
- The local multifamily market continues to record rent increases. Asking rents rose 6.1 percent in the 12-month period ending in the first quarter, reaching $2,029 per month.
- Investment activity slowed to start 2019, following a strong 2018. A drop in the number of Class A property sales was the primary driver of the sales dip. The median price in the first quarter was $225,000 per unit, while cap rates averaged 4.5 percent.
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