Record High Rental Market Keeps Los Angeles Apartment Investors Active This Quarter
Los Angeles, CA, Thursday, August 17, 2017– According to NAI Capital’s Multifamily Market Outlook, the Los Angeles multifamily housing market remains very strong in the second quarter of 2017. The average asking rent hit its highest level on record at $1,678/unit, up by 5.1% over last year. Average asking rents have consistently grown year over year and are up 32% from their lowest point in recession.
The vacancy rate registered 3.9%, down 30 basis points from the first quarter of 2017 and 20 basis point below last year. With approximately 13,208 new units delivered to the market over the past year, market fundamentals indicate the strength of the market. Population and employment growth continue to be the primary drivers of demand for multifamily housing, pushing occupancy rates and asking rents to historic heights. Developers continue to capitalize on this trend, with 32,786 units under construction as of the second quarter and an additional 85,798 new units planned.
The high cost of home ownership in Los Angeles County compounds the supply problem in the rental market. According to the California Association of Realtors, only 29% of residents in Los Angeles County can afford to purchase a home. The median sale price of a single family home hit a new high of $548,220 in June.
According to Vice President, Kevin Kawaoka, CCIM with NAI Capital’ Multifamily Services Group, “In the first half of 2017 we saw many investors sitting on the sidelines in aims of gaining clarity about the political climate and health of the economy. More recently we are seeing their confidence resume and I anticipate that investor demand will continue to respond aggressively to the strong apartment market.”
“Multifamily will continue to benefit from steady job gains which will continue to release pent-up housing demand through the remainder of the year. In addition, hurdles to homeownership will keep many would-be owners in the rental market– and investors view this as low risk for their investment,” Kawaoka added.
To access the full Los Angeles Multifamily Market Outlook report, visit:
About NAI Capital
NAI Capital is the largest independently owned full service commercial real estate firm headquartered in Southern California. As one of the largest members of NAI Global, the premier managed commercial real estate service network with 400 Offices and 7,000 market leaders spanning the globe, NAI Capital provides a complete range of transaction, valuation, investment, property management and consulting services. By leveraging our local expertise with our global reach, NAI Capital offers innovative, customized solutions and seamless service to owners, tenants, investors and developers throughout Southern California. NAI Capital clients have built their businesses on the power of our expanding network. We are a dynamic growing commercial real estate company. At NAI Capital we work together putting our clients first.
NAI Capital Brokerage CA BRE #01990696.
To learn more, visit www.naicapital.com.
About NAI Global
Founded in 1978, NAI Global is a leading global commercial real estate brokerage firm. NAI Global Offices are leaders in their local markets and work in unison to provide clients with exceptional solutions to their commercial real estate needs. NAI Global has more than 400 Offices strategically located throughout North America, Latin America, Europe, Africa and Asia Pacific, with over 7,000 local market professionals, managing in excess of over 425 million square feet of property. Annually, NAI Global completes in excess of $20 billion in commercial real estate transactions throughout the world.
NAI Global provides a complete range of corporate and institutional real estate services, including brokerage and leasing, property and facilities management, real estate investment and capital market services, due diligence, global supply chain and logistics consulting and related advisory services.
To learn more, visit www.naiglobal.com.
# # #