Apartment rents in Orange County could decline an average 2.5 percent this year, according to a new report from the USC Lusk Center for Real Estate.
Courtesy of Fotolia
The Casden Real Estate Economics Forecast gave Southern California's multifamily housing industry a "mixed outlook," due to declines in rents in L.A., in addition to O.C., as well as flat numbers through Riverside and San Bernardino counties. San Diego, on the other hand, is the only market in the region projected to see a rent increase this year.
However, O.C.'s rental rates are not expected to drop as fast as L.A., where numbers are projected to drop an average 3.5 percent this year. And the report notes that new apartment communities in Anaheim and Irvine will continue to draw in renters who cannot afford to buy a home in the county, which continues to boast some of the highest home prices in the state. In February, O.C.'s median home price was $482,700, according to a recent report from the California Association of Realtors.
Among the other highlights: Apartment vacancy rates in the county are expected to remain low, due to higher home prices; and O.C.'s employment base, as well as entertainment, retail and dining offerings will continue to support the economy.
“Overall, Southern California will not see sustained increases in rents until the greater economic health of the region improves,” says Tracey Seslen, Ph.D., co-author of this year’s report.
Seslen notes the Southern California multifamily housing market's health depends heavily on the jobs picture, housing prices and new construction, among other factors.
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