patrick.net

I can confirm that rents are definitely down all over LA. They're dropped in my westside building, and asking rents in my neighborhood are lower today than they were in 2008 by about 10%. I'm sure that if you cherry picked brand new developments and took the reported price from the managers you could come up with a "rents rising" scenario, but it's just not the reality on the street.

Anecdotal evidence from West Hollywood. In 2006, we had been looking for a while and eventually found a mediocre 2 bedroom for $1900 (and felt lucky to get that because many others had applied). During the 2009 crash, we noticed a lot of for rent signs, far more than we had seen before. We started looking around and found a SIGNIFICANTLY better apartment for the same price (and one month free)--2 side by side parking spots, a few hundred square feet larger, a renovated kitchen (with granite and new appliances), and a fantastic view of the Hollywood Hills. Now, the apartment below us (the same in all respects except the view is not as good) just rented for $2300. I'd say we were lucky to rent when we did (and it's rent controlled even better).

I just signed another year lease for the same house I've rented in Culver City for the past 3 years (so this is year 4). I paid $3,000 for the first two years and $3,100 last year and this year. The house and comparable houses would probably sell for about $800,000 and need updating. Still feel like renting is a great deal here. If I bought 4 years ago, the comparable houses would have been about $850,000.

Rents are up in most places. It stands to reason that more people are renters so there is more demand for rentals. The rental market was down during the housing boom of 2004-2006 when many renters bought homes. Now that trend is reversing. As I have said before Patrick.net readers have become a group of housing haters that will never admit when it is starting to turn in the other direction. The housing market like the stock market and the price of oil and is constantly changing. Yes, it was crazy to buy during the inflated years but things have changed. It seems like alot of renters with no experience buying or selling homes are somehow experts in the housing market on Patrick.net.

carolinefpf says

. As I have said before Patrick.net readers have become a group of housing haters that will never admit when it is starting to turn in the other direction.

home owners are usually the most ignorant. no homework, no idea what the market is like, spewing baseless speculation as conclusions. mindlessly repeating cliche and conventional wisdom without asking if it makes sense or not.

if you read the comments by bulls and bears. the bulls are often less informed and almost always less rational.

LARenter says

I can confirm that rents are definitely down all over LA. They're dropped in my westside building, and asking rents in my neighborhood are lower today than they were in 2008 by about 10%. I'm sure that if you cherry picked brand new developments and took the reported price from the managers you could come up with a "rents rising" scenario, but it's just not the reality on the street.

I don't know what ghetto part of Inglewood you live in.. But rents are not down all over LA in desirable neighborhoods with good commutes to jobs. I have a friend who is forced to move from his rental in Burbank, due to the condo owner selling the place. He's looking in the nice parts of the San Fernando Valley for 3 months now everyday and he's about to settle on a $1850 a month 2 bedroom in sherman oaks. (And he thinks it's a pretty sweet deal!) I'm not talking about ultra luxury here.. Just simple amenities like washer/dryer in unit.. some decent square footage 1000+... and some private outdoor balcony space for BBQ ect.

I'll believe my friend whose been looking everyday for 3 months for a longterm rental... vs. someone on this blog doing a few cursory searches on craigslist about the rental market in Los Angeles.

Sure you can find cheaper rent in a noisy, paper thin walled, less desirable neighborhood apartment with shared laundry. But if you want to live like a "grown up" you have to pay out the ass for a decent place anymore.

WestHollywoodRenter says

I'd say we were lucky to rent when we did (and it's rent controlled even better).

Yep, you lucked out! Summer 2009 was the bottom for rents in Los Angeles for this recession.

^^^^

Stop lying and making up things realtor.

John Bailo says

Thanks for exposing all these "Rents Rising" articles peppered in the newspapers.

They are completely unfounded and if anything, I would expect the Rent Bubble to burst quite soon.

You realize you just totally contradicted yourself in 2 sentences.

So you just admitted there is a "Rent Bubble", yet applaud the commentators for "exposing" the falseness of the articles stating rents are at all-time highs and rising?

ok.........?

In my opinion, and I have lived here in Southern California since 1987, the only rents that are rising are from the corporate moguls like this corporation. Here, 1 bedrooms go for $1,725 to $2,520 and they are popping up all over the city like CVS Pharmacies. Any simply query on Craigslist or other rental sites will show lower prices. ALL have availability.

http://imtresidential.com/aboutus

http://www.imtresidential.com/IMTEncino#View

Also, able to validate, people have moved out of California, further pushing the availability of apartments.

David9 says

Any simply query on Craigslist or other rental sites will show lower prices. ALL have availability.

It doesn't make sense though. Why would anyone rent from IMT or the big management companies if they are SO overpriced compared to your craigs list queries?

Craigs List is full of scams... it's like wading through a landfill to find anything that isn't crap.

I just contacted one of the low priced rentals in encino people on here are quoting as examples of cheap rentals. It was listed for $1350 for a 2bed/1bath house with a yard. Of course no address was given, just a phone number. I emailed the reply ad and I'll let you know if what I'm positive is a scam is as such.

BoomAndBustCycle says

Craigs List is full of scams...

Agree. But they are available, lower priced apartments.

Here, there are 1,144 available apartments in the San Fernando Valley from $1,000 to $2,500.

http://www.westsiderentals.com/guestsearch-results.cfm?region_ID=9&priceLow=1000&priceHigh=2500&property_type_id=0%2C12%2C13%2C8%2C9%2C10%2C20%2C21&searchType=g#pagenum=1

Another example, I like these apartments for $1,500, but I have a perfectly fine apartment for $1,000, it's not worth 50% increase in rent to me.

http://www.equityapartments.com/bbrochure.aspx?PropertyId=2358&utm_source=google&utm_medium=cpc&utm_campaign=losangelesproperties_versailles&s_kwcid=TC%7c4015%7cversailles+woodland+hills%7c%7cS%7cb%7c9017383393

As to why someone would pay $1,725 to $2,520 when other options are available. I do not have a clue.
http://www.westsiderentals.com/guestsearch-results.cfm?region_ID=9&priceLow=1000&priceHigh=2500&property_type_id=0%2C12%2C13%2C8%2C9%2C10%2C20%2C21&searchType=g#pagenum=1

David9 says

Craigs List is full of scams...

Agree. But they are available, lower priced apartments.

I'm not saying there aren't cheap apartments by any means. But a suitable rental narrows down quite a bit once you NEED a minimum of 2 bedrooms, a washer/dryer in unit, one that allows a dog, and has some outdoor area to bbq and play with the dog. Also I prefer not to have 4 shared walls.. so a corner unit or townhouse is preferable... ect...

Once you add those fairly normal "wants" to the list.. Your prices shoot up to $1700 MINIMUM for a 2 bedroom in a decent area. At that point your approaching rental parity fast, and could buy a SFH in a neighborhood like Northridge, Reseda, Granada Hills, Lake Balboa ect for a very similar monthly nut.... (adding at most 10-15 minutes to your commute had you rented in Encino.)

Back in 2006/2007 many housing bulls would respond to articles/stats about how housing prices were trending downward called the articles "propaganda and lies" or had anecdotal stories of how their neighbor sold for xxx,xxx more than the median, or how only brand new construction was heading down.

Now the same kind of quotes are coming from renters when stories about rents increasing are coming out.

I guess it's human psychology at work.

BoomAndBustCycle says

Once you add those fairly normal "wants" to the list.. Your prices shoot up to $1700

Agree. I should mention, I am only a guest on westside rentals, so I cannot search for a particular city and these are usually, a bit older, small complexes, and not the apartments to be found on other apartment websites like rent.com. They are different. So, these can actually be added to the next example, even though I cannot get an exact figure.

Below, there are 294 apartments in Encino alone! At least 2 bedrooms 2 bath from $1,200 to $2,000. Go up to $2,500 same criteria, 413!

http://www.rent.com/search/results/?old_mode=results&old_state_nb=19&old_submarkets=&old_minimumrent_at=1200&old_maximumrent_at=2500&old_bedroom_nb=2&old_bathroom_nb=2&old_dogscats=0%7C0&old_freeform_submarket_nm=Encino&old_topsubmarket_nb=31417&combined_location_field=Encino%2C+CA&minimumrent_at=1200&maximumrent_at=2000&bedroom_nb=2&bathroom_nb=2&combined_location=1&dogscats=0%7C0&propertykeywords_nm=&moresearchoptions=1&supdateprofile=1&toggleSearchBtn.x=45&toggleSearchBtn.y=14

So, where is this rental crisis? Guess that is my point.

Correction on that listing above, the 30 pages goes out much farther than Encino.

Craigslist IS full of scams, but it's also how I found the house I'm living in now. Landlord has been a real peach, and the place has met all our needs for three years.

Paid $2,300 in Santa Monica (2bd,2ba - 950sqft - new bldg) from Oct 10 - Oct 11. Now pay $2,740 from Oct 11 - Oct 12 in same apartment. Pretty sure that rents have increased and that your data doesn't provide full picture.

I just moved down to Tustin (right next to Irvine). My wife and I have perfect credit and I'm working a job that supports the rent easily. It took us SEVEN tries to land a rental house because so many of them were getting snapped up before we could even get the paperwork in.

I take zillow with a big grain of salt but their rental price estimates were damn close to what we found actual asking prices to be (at least with my sample size of 7 homes in a decent middle class neighborhood). Zillow estimated that rental prices in Tustin were up $200 year over year.

I'm paying $2500 a month for a 4 bed home that's worth about $430k (and it's in a housing development so there are MANY close sales comparables to chose from). These days a mortgage would actually be cheaper -- at least before maintenance -- but that's the first time I've seen that in the LA area in a long long time.

My 0.02: the rental market is screamin' hot if you're looking at locations where you actually want to be... Maybe they're down in the outlying areas because less folks want to commute. I'm not sure.

joelnpayne says

I'm paying $2500 a month for a 4 bed home that's worth about $430k (and it's in a housing development so there are MANY close sales comparables to chose from). These days a mortgage would actually be cheaper -- at least before maintenance -- but that's the first time I've seen that in the LA area in a long long time.

Curious.

I just ran a searchon Redfin for 4 bedroom homes sold in Tustin over the past 3 months with a max price of $450K and no other parameters. Not a single one was in a housing development.

Actually, throughout the entire city of Tustin, there were only 12 homes sold with those parameters over the 3 month period.

Not that I'm calling bullshit or anything.

DUKE 201 says

Paid $2,300 in Santa Monica (2bd,2ba - 950sqft - new bldg) from Oct 10 - Oct 11. Now pay $2,740 from Oct 11 - Oct 12 in same apartment. Pretty sure that rents have increased and that your data doesn't provide full picture.

Aren't apartments in Santa Monica rent controlled?

zesta says

Back in 2006/2007 many housing bulls would respond to articles/stats about how housing prices were trending downward called the articles "propaganda and lies" or had anecdotal stories of how their neighbor sold for xxx,xxx more than the median, or how only brand new construction was heading down.

Now the same kind of quotes are coming from renters when stories about rents increasing are coming out.

I guess it's human psychology at work.

Urban metro had not begun to fall in 2006, and many areas hadn't begun to fall in 2007. So statistics wouldn't jive with all areas.

Same thing now. Places like Phoenix legitimately have bottomed. Parts of metro California are not even close.

Look, if you have a huge lists of NEEDS on your rental, you might as well drop your shorts and hope someone has some lube. If not, you can get a very inexpensive rental compared to apples to apples purchases in a LOT of areas of LA County, including the most desirable places. My current rental at $1640/mo would cost $300K to purchase + $620HOA + $100 parking.

This all of course does not even discuss the current lack of inventory in LA County available for purchase. And personally I'd much rather rent a place I wasn't totally happy with for a year or three rather than mortgage a place I wasn't totally happy with for the next 10, 15, 30, or more years.

I would wager this exodus will show us a significant cause of increase in vacancy factors. Now if we could just dupe those financial institutions into buying the millions of foreclosures and put them out as rentals, we will see some realistic pricing.
http://www.cis.org/IllegalImmigration-ShiftingTide

IR AL SUR DE MI HIJO !

We have moved annually in LA for four years. We have read the "rents are soaring!" stories for at least three. Our experience has been eager landlords, low security deposits and negotiable rental prices.
If the market was tight it doesn't make sense that landlords would be willing to drop their advertised rent.
We have lived in a variety of places: mid market, ok neighborhood apartment; fancy apartment, premium neighborhood; and our current place is a house in a middle class area. Our experience has been the same.
Some rent controlled areas the landlords are willing to put a huge rental price up and keep the apartment empty until someone dumb enough to pay it comes along.
I deal with a wide selection of LA society every day and they chat to me about everything. I've lost count of the number of complaints I've heard about parking tickets going up but I have yet to hear a single complaint regarding rising rents.
Rental rates soaring makes as much sense to me as the stories constantly saying that the economy is great in CA now.

dodgerfanjohn says

Curious.

I just ran a searchon Redfin for 4 bedroom homes sold in Tustin over the past 3 months with a max price of $450K and no other parameters. Not a single one was in a housing development.

Actually, throughout the entire city of Tustin, there were only 12 homes sold with those parameters over the 3 month period.

Not that I'm calling bullshit or anything.

No problem. I live in Tustin Meadows, it's the 1000 or so homes centered around Centennial Park.

A couple random comparables:

This is our model of home from within the neighborhood.
http://www.zillow.com/homedetails/14711-Emerywood-Rd-Tustin-CA-92780/25471977_zpid/

This is the bigger model (two story 4 bed):
http://www.zillow.com/homedetails/2012-Kingsboro-Cir-Tustin-CA-92780/25472431_zpid/

There are certainly plenty of sales in the neighborhood in the high 4s and low 5s (5s especially if you have a bigger corner cul-de-sac lot), but I was just ball parking based on the better deals from recent sales. Zillow estimates our home in the mid $430s and it's fairly standard inside and out. We looked at two of the bigger models, one was renting for $2700, the other for $2800.

joelnpayne says

No problem. I live in Tustin Meadows, it's the 1000 or so homes centered around Centennial Park.

A couple random comparables:

This is our model of home from within the neighborhood.
http://www.zillow.com/homedetails/14711-Emerywood-Rd-Tustin-CA-92780/25471977_zpid/

This is the bigger model (two story 4 bed):
http://www.zillow.com/homedetails/2012-Kingsboro-Cir-Tustin-CA-92780/25472431_zpid/

There are certainly plenty of sales in the neighborhood in the high 4s and low 5s (5s especially if you have a bigger corner cul-de-sac lot), but I was just ball parking based on the better deals from recent sales. Zillow estimates our home in the mid $430s and it's fairly standard inside and out. We looked at two of the bigger models, one was renting for $2700, the other for $2800.

Nice house... Perfect example of a fair price in Los Angeles Area... (Ok, this is the OC)... But perfect example of rental parity in play that everyone keeps denying is happening!

No one going to comment about what decent deal this guy got on a home in Tustin... Oh well

BoomAndBustCycle says

No one going to comment about what decent deal this guy got on a home in Tustin... Oh well

Really?

You really want me to keep commenting on a series of posts where OP posts:

1.) An OUTDATED sale price(lol "comp") from over a YEAR ago.
2.) On a situation where the OP keeps changing the price range we are discussing, from an initial amount of $430K to $500K.
3.) quotes of zestimates and zillow rental amounts which are notoriously inaccurate.

Every home in the past three months in that tract sold for $490-530K. Except for one possible outlier that sold at $425K. But I'm too lazy to go research that.

Really realtor? Really?