Thursday, October 19, 2006

California Rental Market Strong

Looks like a strong economy to me................

A Home Market That's Tight: Rentals
Apartment rents climb 6% in California as they play catch-up with sale prices.

Playing catch-up with the recent run-up in home prices, rents in large apartment complexes posted strong gains across California in the third quarter, according to data to be released today.Rents rose an average of 6% in most of the state's biggest markets, Novato, Calif.-based research firm RealFacts said. Southern California remained the West's most expensive place to rent, and the San Francisco Bay Area saw the highest rent increases, RealFacts said.

The rental market is likely to tighten further with the state's stable job market attracting more people to move here, although rising rents could slow economic growth, analysts say."We have no trouble finding tenants," said Rafael Padilla, a commercial property broker who owns about 35 apartment units in West Los Angeles. "The influx of people is still tremendous. If I lose one tenant, there are three more behind them."The average rent in Los Angeles and Orange counties rose 7.4% to $1,546 during the third quarter, making the counties the most expensive among 28 Western markets, said RealFacts, which surveyed 12,000 apartment buildings of 100 or more units in 15 states.

Rents increased 7.6% to an average of $1,452 in Ventura County. The Inland Empire is becoming more of a landlord's market as well, with rents in Riverside and San Bernardino counties rising 6% to $1,129.In Silicon Valley, the average rent jumped 10.4% to $1,450, the first double-digit increase in the high-tech heartland since the end of the dot-com boom in early 2001. Then, Santa Clara County's average rent peaked at $1,959. For all of Southern California, occupancy rose 0.4 percentage point from a year earlier to 96.2%. RealFacts analyst Chris Bates said occupancy above 96% was generally considered fully occupied — meaning that renters were having increasing difficulty finding vacancies.

LA Times - By Annette Haddad, Times Staff WriterOctober 19, 2006,0,6721437.story?coll=la-headlines-business

1 comment:

Sven said...

Have you considered the possibility that more people are renting because fewer people are buying?

Your site cracks me up. How can you expect real estate to climb back up in 2007 when less than 10% of the people can afford to buy a house and lending practices are tightening to shut out the people that can't afford to buy. Is that 9.4% of the population REALLY going to drive up the price of over 1 million homes in San Diego?