The 1st Quarter 2009 report on Metro Los Angeles rental activity reveals that average asking rents edged down 1% on an annualized basis, a far cry from the 5 – 6% annual rent acceleration during the 2005 – 2007 period.
Current monthly asking rents in the Metro area are $1,016 for a studio, $1,314 for a one bedroom, $1,683 for a two bedroom, and $2,032 for a three bedroom.
It should be noted that Metro Los Angeles includes areas as far and wide as Palmdale/Lancaster, El Segundo, Whittier and Arcadia and should not be equated with Westside LA or Central LA City.
Vacancy rates for apartments in Metro Los Angeles experienced a sharp uptick from 4.5% in the 4th Quarter 2008 to 5.3% in the 1st Quarter 2009.
The decline in construction activity has had a dramatic effect on the rental market. In the 1st Quarter 2009, only 647 rental units were built – and 5,557 were absorbed.
The severe downturn in construction has curtailed the supply and development of new rental units, and the rental market is forecasted to tighten in the coming years.
Below are asking rents and vacancy rates in a few key neighborhoods:
Santa Monica – $2,431 – 3.4%
West LA/Westwood – $2,300 – 5.8%
Downtown – $1,978 – 9.7%
Beverly Hills – $1,856 – 5.4%
Pasadena – $1,704 – 6.3%
Sherman Oaks - $1,578 – 6.3%
Mar Vista/Palms – $1,516 – 3.7%
Burbank Glendale – $1,497 – 3.6%
Hollywood – $1,436 – 3.3%
Van Nuys/North Hollywood – $1,112 – 3.9%
Palmdale / Lancaster – $859 – 9.5%
Note the combination of high rent and low vacancy in Santa Monica, high rent and high vacancy Downtown, low rent and low vacancy in Hollywood, and low rent and high vacancy in Palmdale / Lancaster.
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