Real Estate News – “Sky-high apartment rents in Southern California are expected to climb further in coming years, as construction fails to keep up with population and job growth.”
Real Estate News:
No Relief In Sight For Southern California Apartment Rents
San Gabriel Valley Apartments Are No Exception
The USC Casden Multifamily Report is out, and it’s not good news for renters just yet. The report finds no relief in sight as far as Southern California apartment rents are concerned … in the near future. Of course, San Gabriel Valley apartments are not miraculously exempt from this trend as the underlying cause is simple: supply and demand. And the rules of Supply and Demand are in effect in all of Southern California.
Anyone who has tried to rent an apartment anywhere in Southern California will be aware that rents are high just about anywhere. The fact is that over the last decade there were a lot of folks who were homeowners who are not anymore. They lost their homes in foreclosure and began renting their home or became apartment dwellers. Financial conditions over the last few years, combined with the new, high prices to purchase a home have also contributed to the number of renters seeking dwellings for rent.
The result is that construction has not kept up with demand. When that happens … prices go up, and that’s what we have today with the cost of rentals in Southern California. And, we have no relief in sight for the near future.
There is, however, a hint of possible good news here, in that the economic experts who compile the USC Casden Multifamily Forecast believe that we may be seeing the “beginning of the end” of this trend. They’re not predicting a “rental turnaround” immediately, but are saying that there are factors in play that could foreshadow the end of this “bull market” in Southern California apartment rents.
Here’s a comprehensive article by Andrew Khouri from the L.A. Times. This article is based on the Casden report, but only mentions the fact that there is no relief in site immediately. It does not delve into the more complicated subject of just when this trend of really high cost for apartments in Southern California might come to an end … or at least slow down. The full report does address this, and it’s available for you to download at the bottom of this page.
“Sky-high apartment rents in Southern California are expected to climb further in coming years, as construction fails to keep up with population and job growth, according to a forecast released Tuesday. The average rent in Los Angeles County is expected to hit $1,416 a month in 2018, an 8.3% jump from last year, while in Orange County, average rents are likely to rise 9.4% to an average of $1,736, the USC Casden Multifamily Forecast said.”
The USC Casden Multifamily Report
The USC Casden Multifamily Report is a long standing and well-respected part of the Casden Real Estate Economics Forcast, which is part of the USC Lusk Center. It operates under the Casden Endowment, originally funded by Alan Casden, a major developer of Southern California multifamily housing.
If you would like to read this complete report, You can download the FULL REPORT here: https://lusk.usc.edu/casden/multifamily/report
Real Estate News
Mortgage Rates – “The average rate on the popular 30-year fixed loan is now at its lowest level of the year and could potentially head lower into new record territory.”
Home Loan Rates: How Low Is Low?
A Video Report
When the Fed raised interest rates at the end of last year, most everyone in the industry believed that would bring on a rise in mortgage rates. Well, that shows how much the “folks in the know” … know. The big real estate news of 2016 (so far) is that exactly the opposite has happened … and continues to happen.
Here’s a video report from Diana Olick of CNBC about current home loan rates, and what we might see in the near future.
Lower Mortgage Rates Still Ahead?
A few weeks ago in these pages, we pointed out the fact that home loan rates tend to follow the action of the 10-Year US Treasury bond prices. We stated then that the bond prices were indicating lower mortgage rates still to come … and that is exactly what we’ve seen during the ensuing days. At this point, the relationship between the two prices is still the same: the bonds are still trading downwards and there is no reason to suspect anything other than that Mortgage Home Loan Rates will continue to follow them for the short term.
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A potpourri of political and economic factors are behind the fall in mortgage rates, which follow loosely the yield on the U.S. 10-year Treasury. Both the Fed and the European Central Bank expressed concern this month about the trajectory of the global economy. Consumers and investors are on edge because of three factors: Oil prices can’t seem to make a decided move higher; some analysts are concerned about a stock correction; and the race for the White House has been highly volatile.