Apartment rents are expected to rise as much as $148 a month in the next few years across Southern California, with multifamily construction not keeping up with demand.
Rents will increase between $110 and $148 a month across the five-county Southland, with tenants paying $58 more per month in Los Angeles County, the Orange County Register reported, citing USC’s Casden Multifamily Forecast.
The rent hikes pale in comparison to double-digit percentage jumps during the pandemic.
A housing shortage coupled with a lag in multifamily construction has contributed to the steadily rising cost of leasing, which has risen for nearly 14 years.
“Though the economy has proven quite robust, new housing supply and affordability remain on shaky ground,” forecast co-author Moussa Diop, an associate professor of real estate at the University of Southern California, said in a statement.
“We’ve experienced a construction slowdown in an area dangerously tight on new supply. Meanwhile, states like Florida and Texas are outbuilding us. When it comes to housing, California is falling behind,” he said.
Construction in states like Georgia and North Carolina amounts to between 1.5 percent and 2 percent of their apartment inventory.
But in Los Angeles, Orange, Riverside, San Bernardino and San Diego counties over the past year, developers have completed 20,709 units — or 1.2 percent of the region’s 1.7 million apartments, according to the USC forecast.
The anticipated rent hikes are moderate compared to 15 months of double-digit hikes from 2021 to 2022.
Since the pandemic, rents will have risen an average of $300 per month in 2026 in Los Angeles County and between $600 and $700 per month in the rest of Southern California, according to the forecast.
In Los Angeles County, the average apartment rent is expected to rise to $2,334 a month by mid-2026, a 3 percent increase from $2,276 a month last summer.
In Orange County, the average apartment rent is expected to rise to $2,786 a month by mid-2026, a 4 percent increase from $2,676 a month last summer.
In the two-county Inland Empire, the average apartment rent is expected to rise to $$2,211 a month by mid-2026, a 7 percent increase from $2,063 a month last summer.
— Dana Bartholomew
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