Low housing inventory and higher demand within Los Angeles County are signs that the economy is on the upswing. The tradeoff is those looking to purchase a home or rent an apartment will have to pay more.
According to the latest data, despite an 18 percent jump in home construction permits last year, vacancies in L.A. County continue to lag behind the national average. The climb in rental prices is expected to continue for at least the next 2 years.
The state’s population has grown faster than the national average, housing 13 percent of all American residents. Yet, in the past two decades, California has only been responsible for 8 percent of all new residential building permits, according to a report by the 2016 USC Casden Multifamily Forecast
Even though apartment construction is back to "pre-recession" levels, the forecast says, the state's growing economy and population are jacking up demand quicker than apartments can be built; besides which, most of what's being built is expensive luxury housing.
The report predicts the average rent will “soar” from its 2015 average of $1,307 up to a countywide average of $1,416. The vacancy rate will stay about the same, at 4.1 percent—just under its 2015 rate of 4.2 percent.
Inglewood, Gardena and Hawthorne had the lowest average vacancy rate at 1.5 percent. There is no rent control in Inglewood or Hawthorne. According to Trulia.com, the median price for rentals in Inglewood for March 2016 was $2,400, an increase of 54% compared to the same period last year.
In home sales, Los Angeles market trends indicate an increase of $47,500 (8%) on average over the past year. The average price per square foot for this same period rose to $526, up from $479.
The median sales price for homes in Inglewood for January 7 to April 6, 2016 was $382,500 based on 62 home sales, Trulia found. The average price per square foot for Inglewood was $308, an increase of 22% compared to the same period last year.
It’s a seller’s market for sure. If you plan to sell your home, you should be able to get a good price. If you’re a renter or looking to buy (especially as a first time buyer), the best strategy now might be to stay put.