Business
Southern California to experience rent increases by 2023
November 10, 2021 3:40pm
Updated: November 10, 2021 5:33pm
Rents throughout California are increasing and are going to keep getting more expensive. A USC Casden Economics Forecast released on Tuesday predicted increases in rent throughout Southern California.
By 2023 rents will increase by $252 in Los Angeles County, $410 in Orange County, $348 in San Diego County, $310 in Ventura County and $241 in the Inland Empire, according to the Forecast.
"COVID-19 caused a large-scale move from central cities to the suburbs that resulted in a sharp rise in apartment vacancies in Downtown L.A., Koreatown, and Beverly Hills and historically low vacancies in Rancho Cucamonga, North City San Diego and Oxnard," USC Lusk Center for Real Estate Director Richard Green said. "While vacancies are coming back down in urban areas, the outskirts remain low and supply and will see rents go up at a much higher rate than the cities."
The rise of remote work and the closing of restaurants and other activities in cities caused many California residents to relocate to the suburbs. As a result, metro area vacancies are at their lowest level in two decades.
Currently, downtown Los Angeles, Koreatown and Beverly Hills have vacancy rates above 5%, the report said.
Over the past year, Southern California rents hit record highs, according to a report by NAI Capital. Compared to last year, average rents increased 49%. Housing affordability has also worsened during the pandemic.
Housing prices are also expected to increase. The California Association of Realtors' housing and economic forecast expects median home prices to increase by 5.2% from the previous year to $834,400 in 2022.
From 2019 to 2020, home prices in the state increased 11%, the CAR forecast reported. During the pandemic, home prices jumped 20%, from $659,400 in 2020 to $793,100 in 2021.
"Housing costs is the majority of your income coming in every single month and you're scraping by usually two or three jobs just to keep housing over your head," said a resident of San Bernadino County.
