Long Beach tenant Shelby Bisaccio summed up the Southern California rental market in one word.
“Expensive.”
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Bisaccio, a 32-year-old bartender, had been apartment shopping about a month ago, but gave up because she couldn’t find anything she could afford.
“It’s ridiculous,” she said while folding clothes at an east Long Beach laundromat. “Just for a one bedroom, it’s $2,000 (a month). That’s on the bad side. This neighborhood, a one bedroom is $2,400 to $2,500. And that’s lowball.”
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Even though the pace of rent hikes slowed dramatically in Southern California over the past 1 1/2 years, tenants say they still struggle to pay for housing.
During the height of the pandemic, rent hikes soared into the double digits.
In the year ending in December, Orange County rent growth had cooled to 2.4%, or just $62 a month more than the year before, according to a composite of data from apartment trackers CoStar, RealPage and Moody’s Analytics/Reis.
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In Los Angeles County and the Inland Empire, rent even fell a little bit, dropping $35 and $22 a month, respectively.
Despite the cooldown, however, rents still are higher — 15% to 31% higher — than they were before the pandemic.
Los Angeles County rents are up $315 a month since the pandemic, composite numbers show. Orange County rents increased $572 a month, while Inland Empire rents were up $465 a month.
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“Even as rent prices go down, somebody who looks for a new apartment today could still be experiencing a jump,” said Rob Warnock, a senior research associate with Apartment List, an online rental search site. “For those people who move today, they’re going to experience a different market than what they may have seen in 2019.”
The pandemic-era rent jump increased the number of cost-burdened renters while ballooning homelessness by 30,000 people across the state.
The number of Southern Californians paying more than a third of their income on rent increased 2 percentage points to 58% from 2019 to 2022, Harvard University’s Joint Center for Housing Studies reported in January.
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Almost a third of Southern California tenants were paying at least half of their income on rent as of 2022.
A dwindling supply of low-cost housing worsened cost burdens.
There were 39% fewer units renting for under $1,400 a month in 2022 than a decade earlier, while units renting for $2,000 a month or more jumped 125%, the Harvard center reported.
“Though rent growth has recently slowed substantially, the extended period of rising rents during the pandemic propelled cost burdens to new heights,” the Harvard report said.
Three times the rent
Last year, Cecilio and Gloria Azua had been paying $1,000 a month for a two-bedroom unit in a Santa Ana duplex that they shared with two grown daughters and their dogs, Luna and Roni.
But last summer, their landlord told them she was selling the duplex, and they had to move out of their home of 20 years.
It took them almost three months to find a two-bedroom apartment in Westminster that would take their dogs. But their rent jumped to $2,600 a month, plus they had to pay an extra $1,000 pet deposit for their pets.
“It wasn’t easy,” Cecilio Azua, 63, a retired warehouse worker, said in Spanish. “You have to pay almost three times the rent. You have to have good credit, and they charge for pets.”
Their old rental was bigger, and had parking for all their cars.
Their new apartment provides just one parking space, charging an extra $50 per month for one additional spot. They park their other two cars on the street.
Their water bill for the new apartment is almost 40% higher.
The Azuas already are planning to hunt for something cheaper when their lease expires next November.
“The rent went up so much,” said Gloria Azua, a 66-year-old retiree. “What the government gives us (in Social Security) isn’t enough. I’m going to have to go to work.”
New construction
New apartment construction and diminished demand cooled the rental market over the past 1 ½ years.
Numbers from data firm RealPage show nearly 16,000 new apartments opened in Los Angeles, Orange, Riverside and San Bernardino counties in 2023, or about a fifth more than the average for the previous four years.
Los Angeles County got an additional 10,633 new units, RealPage figures show; Orange County an additional 2,784; and the Inland Empire received an additional 2,200.
The impact was more dramatic in the Inland Empire, since those 2,200 units represented a bigger share of the total apartment supply in those counties, said Carl Whitaker, RealPage senior director of research and analytics.
“In the case of Orange County, … there’s more demand than there is supply,” Whitaker said. “Conversely, Los Angeles and Riverside-San Bernardino, the supply side of the equation is a little bit higher, and that’s keeping rent growth more muted — and actually negative year over year.”
Whitaker said the pandemic surge in apartment demand in 2021 and part of 2022 — driven in part by people wanting more space while working from home — actually pulled demand forward from 2022 and part of 2023.
As a result, apartment vacancies have been rising for the past 21 months, hitting 5% at the end of last year in Los Angeles County and the Inland Empire and just under 4% in Orange County, composite numbers show.
“Concerns about the economy and about inflation and about affordability more broadly have slowed down the formation of new households,” said Apartment List’s Warnock. “So, while the inventory side of the rental market has been growing and improving, we have seen relatively tepid demand from people who are looking to move into those new homes.”
Shopping for a house
In the two years since Monet Williams, her husband, their two toddlers and their Boston terrier moved to a luxury apartment in downtown Long Beach, their rent has gone up nearly $300 to $4,000 a month.
Even though she and her husband both work, “we’re spending most of our money on rent,” she said.
While she loves the view from her apartment, she’s unhappy with the area. Residents are terrorized by skateboarders, she said. Their cars have been broken into, and the landlord is slow at addressing repairs and roaches.
“We’re actively looking,” said Williams, 39, who works for the city of Beverly Hills. “We want a house.”
While some houses rent for less than what Williams and her husband now pay, competition is stiff. Up to 20 people show up for tours. And the deposits are high.
“Obviously, we’d like to buy,” Williams said, “but the interest rates are too high, so we’re looking for rentals.”
Orange County an exception
With the average rent for apartments of all sizes at $2,657 a month in the fourth quarter of 2023, Orange County remains Southern California’s most expensive rental market.
Before the pandemic, L.A. County rents were higher. By the end of last year, the average rent in L.A. County was $2,470 a month, composite numbers show. Inland Empire rents averaged $1,984 a month.
But while rents are dropping in most Southern California counties, Orange County is an exception, with rents still rising.
Apartment List, an online rental search site, shows January rent up in almost every Orange County city it tracks, with rent down in almost Los Angeles County city it tracks. In the Inland Empire, the results were mixed, with rents up in four cities and down in six.
“Demand outpaced supply growth in Orange County last year, leading vacancy lower,” said Jesse Gundersheim, a CoStar market analyst. “Most other markets across the country saw apartment vacancies rise.”
One check for rent
Electrician Juan Soto spends half his income on the two-bedroom, two-bath townhome in Garden Grove he rents for $2,500 a month. He and his wife share a bedroom with their 12-year-old son so their daughter, 17, can have her own room.
“I get paid every two weeks. One check is for rent, one check is for bills and food,” said Soto, 39. “You don’t have enough money to take vacations or to take the family on a nice trip, even if driving because it’s expensive.”
The rent has gone up $850 per month, or more than 50%, since they moved there seven years ago.
He’s been looking to buy a house for five years, but hasn’t been able to qualify for a mortgage. And home prices keep rising.
“It’s getting worse,” Soto said. “Normal people like me, I don’t think we can afford (to buy) a house at this price.”
Here are January rent numbers for the 32 Southern California cities Apartment List tracks, with one year percentage changes:
L.A. County cities
- Burbank: $2,036; -3.8%
- Glendale: $2,159; -0.6%
- Long Beach: $1,751; -2.8%
- Los Angeles: $2,055; -4.0%
- Pasadena: $2,405; -0.2%
- Pomona: $1,816; -0.1%
- Santa Clarita: $2,441; 3.9%
- Santa Monica: $2,564; -5.4%
- West Hollywood: $2,131; -4.0%
Orange County cities
- Aliso Viejo: $2,913; 2.6%
- Anaheim: $2,255; 1.2%
- Brea; $2,459; -0.6%
- Costa Mesa: $2,390; 1.0%
- Fullerton: $2,330; 1.5%
- Huntington Beach: $2,473; 1.4%
- Irvine: $2,971; 2.3%
- Laguna Niguel: $3,088; 0.1%
- Lake Forest: $3,139; 1.5%
- Mission Viejo: $2,914; 0.7%
- Newport Beach: $3,230; 1.7%
- Orange: $2,455; 3.2%
- Santa Ana: $2,189; 1.6%
Inland Empire cities
- Chino: $2,289; 0.8%
- Chino Hills: $2,847; 3.6%
- Corona: $2,303; 0.4%
- Moreno Valley: $1,889; -2.8%
- Murrieta: $2,173; -0.9%
- Ontario $2,029; -1.7%
- Rancho Cucamonga: $2,076; -0.7%
- Riverside: $1,760: -4.0%
- Temecula: $2,298; 2.8%
- Upland: $2,060; -1.3%
