SoCal Multifamily Sales Pulse - May 17, 2021 - May 23, 2021

Rent Drops Forecast For Central, Coastal Portions Of L.A. County

USC's apartment forecast for the next year predicted Inland Empire rents will increase 9-10%.

If the past year is any indication, apartment rents will continue dropping in central and coastal portions of Los Angeles County through the next year, with rent hikes occurring everywhere else in the Southern California, a University of Southern California multifamily forecast said.

For example, the Koreatown-Mid City portions of L.A. will see rent decline 1.2% over the next year, while west Riverside and San Bernardino counties will see rent hikes of 9-10%.

The USC Lusk Center for Real Estate, which publishes the Casden Multifamily Forecast each year, warned its predictions are uncertain because the data are “based on a previous year unlike any other previous year.”

The forecast, which normally comes out in the fall, was postponed because forecasting at a time of uncertainly is problematic and possibly misleading, the report said.

Lusk also predicted that despite billions of dollars in rental assistance, many tenants still will owe thousands in back rent, leading to evictions for some. Eight percent in L.A. and Orange counties reported recently they are “housing insecure.”

“We still have loads and loads and loads of uncertainty,” Lusk Director Richard Green said during an online panel discussion before releasing the report.

Among the unknowns facing the region’s landlords are whether jobs and amenities will come back to downtown and central L.A. once the pandemic ends, or whether a pandemic-inspired migration to less urban parts of the region are going to be temporary or long-lasting.