The latest USC Casden Multifamily Forecast report predicts that rents will continue to rise in the region despite new construction, as demand for rental housing continues to increase.
In the report released Tuesday, USC Lusk Center for Real Estate Director Richard Green said the market is being fueled by rising home prices. The study predicts that rents will increase for at least two more years across all of Southern California, while vacancy rates will continue to drop.
“Despite marked improvements in employment and the economy, the rapid increase in home prices and interest rates are pricing first-time home buyers out of the local market,” Green said.
Between the four areas tracked, which comprise the Inland Empire and L.A., Orange and San Diego counties, almost 6,700 new units were constructed in the 12 months that ended June 30, the report stated.
Throughout L.A. County, rents increased 2.9 percent to an average of $1,435. Only Orange County has a higher average rent among the four areas at $1,572. The submarket with the highest rent in the region was Santa Monica at $2,328. Victorville in San Bernardino County had the lowest rent at $755.
Los Angeles County had the second lowest vacancy rate at 3.2 percent, with San Diego County at 2.3 percent.