Good morning. It's Thursday, March, 14. Here's what you need to know to start your day.
L.A. rental prices may be cooling. Here's what that feels like:
A new data point suggests that the L.A. region's notoriously high-priced rental market may be cooling. But for many, it probably feels like the difference between a 102-degree and 100-degree day during a prolonged heat wave.
Rental prices decreased by 2.5% in February in Los Angeles County compared with a year earlier, Times staff writer Terry Castelman reports.
But does this decline translate to any modicum of renter relief?
"The best deals have been occupied for a long time," said Dowell Myers, a professor of policy, planning and demography at USC. When renters secure a great deal below market prices, they are reluctant to vacate these units.
Still, predominately young adult apartment searchers flood Facebook housing groups, searching for any leads on finding affordable housing in Southern California's competitive rental market.
"Young renters are more impacted by price changes because they don't have access to those deals," Myers said, acknowledging their struggle to find affordable housing.
Renters on the ground floor
Rick Hefner, 30, was among those searching for housing amid the February price decline.
"I've done the whole housing search three times within the past six months, and it's infuriating," Hefner said. "Apparently, prices are falling, but it's still way too expensive."
Settling in the L.A. area around five years ago, he bounced around apartments until he found a place in Pasadena — a two-bedroom, $3,004-a-month unit he shared with a couple of students from South Korea. He contributed $1,502 plus utilities for his bedroom while his two roommates split the rest and shared the other room.
As his lease agreement was about to expire and his roommates prepared to return to South Korea, Hefner and his parrot found themselves priced out of Pasadena — and much of L.A.
"Pasadena is expensive man," Hefner said. For these tiny little studios with no AC, they want $2,000 because it's Old Town Pasadena. I love the area, but it's too much."
Looking through L.A. County, many of the places were less than ideal. Several listings demanded multiple concessions, including sharing space with roommates, offering only street parking and requiring move-in prices upward of $4,500.
"I don't make a ton of money, and it's not like I can get an apartment for two grand by myself," Hefner said. "You can't even find a place under $1,000 anymore, even on Craigslist. I could not find anything. Unless it's like, 'Hey, you want to share an air mattress in my studio?'"
Tired of sifting through scores of listings, many of which turned out to be scams or misrepresented, he opted to pay $1,850 for a studio in North Hollywood — $350 above his budget.
Hefner works remotely on a contract basis in the entertainment industry, designing concept art for video games. His home is also his workspace.
Fortunately, he and his significant other found that the 600-square-foot studio is spacious enough to accommodate his equipment, furniture and a bird cage.
How much of a drop?
Hefner's search could have been worse. Although L.A. County's 2.5% rental price decrease is the second biggest of any county in the state, regional prices tend to vary.
Rent has risen by as much as 3.8% in several Northern California counties year over year, while most large Southern California counties saw a drop in rents.
Alameda County, an exception to rising rent in the Bay Area, recorded rent downturn of 4.7% from February 2023, representing the 19th biggest annual drop in the U.S. Orange County was an exception to falling rent in Southern California, with rent rising 1.6%.
Experts link lower rents to a possible drop in demand after population losses during a recent exodus from parts of Southern California. As the state's population has stagnated, some believe demand may cool and dampen rent growth.
Falling rents suggest either that "supply has finally caught up or that slower economic growth and/or population outmigration has weakened demand," Myers said.
The 10 counties nationwide that saw the most significant drops in rent last February were all in states with population booms but with robust housing construction in recent years: Florida, Alabama, Georgia and Texas.
An increase in housing stock could keep rent prices down and, coupled with a population decrease, benefit Californians.
But for now, even with this February decrease, housing supply and demand will continue to leave the state's rental market unaffordable for many.
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