It’s getting far more challenging for a Southern California tenant to find falling rents.
My trusty spreadsheet reviewed September’s rent report from ApartmentList, which includes cost indexes for 52 cities across the region. Pricing, primarily for apartments, is tracked by combining government stats and listing data from its own website.
September’s math shows landlords upping prices in 58% of Southern California cities. That’s 30 cities with rents gaining among the 52. The region’s median rent change was a 0.9% increase.
Look, these are not giant jumps. But it’s a directional switch from April, when rents were rising in just 37% of the region’s cities, and the median rent change was a 1.5% decrease.
This swing suggests that fewer local landlords will offer rent concessions in the coming months.
High end rising
A peek inside September’s numbers shows that the odds of rising rents are higher where the pricing is steeper.
Ponder those 30 cities with one-year rent hikes. This group’s median 1.5% one-year gain came in places where a typical one-bedroom unit costs $2,100 a month and a two-bedroom costs $2,550.
Meanwhile, in the 22 cities with falling rents – a median drop of 1.5% – one-bedroom units run $1,850 per month, and two-bedroom units cost $2,280 per month.
So, you see that the cities with rent gains have one-bedroom units that are 14% more expensive and two-bedroom units that are 12% costlier.
This is another example of a highly polarized economy in which financial conditions are pretty good for those with higher paychecks, while folks of modest means often struggle.
Split markets
Where a tenant looks for a place to live matters to what they’re charged, as regional data can obscure local differences.
Basically, it’s tough to find bargains in Orange County and the Inland Empire. Both markets had one-year rent gains in 92% of their cities.
Tenants paid more in 12 of 13 Orange County cities tracked, with a median gain of 2.9%. In the I.E., rents increased in 11 of 12 cities, with a median increase of 1.4%.
It’s quite a different picture elsewhere.
Rent hikes were rarest in Ventura County. Tenants paid more in just 17% of its cities — that’s just one of six — with a median 1% dip.
In Los Angeles County, rents rose in 21% of its cities — that’s three of 14 — with a median decline of 1.7%
And in San Diego County, tenants paid more in 43% of its cities – that’s three of seven – with a median rent decline of 0.2%.
Pricing extremes
Now, contemplate the 10 cities across the region. All from Orange County and the Inland Empire.
Orange County rents are always high and often rising. It’s a reasonable bet that these costs push some tenants to look elsewhere for housing, boosting demand for rentals in Riverside and San Bernardino counties.
Laguna Niguel had the largest one-year hike at 7.6%, followed by Newport Beach (6.7%), Brea (4.5%), Mission Viejo (4.2%), Temecula (3.5%), Moreno Valley (3.4%), Chino Hills (3%), Fullerton (3%), Lake Forest (3%), and Orange (2.9%).
Next, think about the other end of the price-swing spectrum. Note the heavy influence of Los Angeles County in the 10 cities with the region’s largest one-year rent drops.
The largest drops were found in Santa Monica, followed by Pomona (off 4.6%), Monro, Simi Valley (off 3.4%), Santa Ana (off 2.6%), Inglewood (off 2.5%), Santa Clarita (off 2.4%), Escondido (off 2.1%), Calabasas (off 1.8%) and Glendale (off 1.8%)
Some of these L.A. County declines could be a move back toward somewhat normal housing demand now that the horrific January 2025 wildfires are further removed from the economic equation.
Tenant Talk tracks the rental world. Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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September’s most popular Southern California real estate stories …
No. 1: Taco Bell relocates its longtime Irvine headquarters
No. 2: Diane Keaton’s former Laguna Beach flip lists for $10 million
No. 3: What’s the best housing market in Southern California?
No. 4: Dolly Parton’s former Solvang cottage compound lists for $2 million
No. 5: Newport Coast home linked to Latin music star Peso Pluma seeks $14 million
No. 6: Ultra-luxe, ‘overengineered’ beachfront Dana Point estate seeks $65 million
No. 7: California wants more fines against Huntington Beach in housing lawsuit
No. 8: Laguna Cliffs Marriott Resort rebrands amid renovation
No. 9: Historic Dana Point home by Hollywoodland developer lists for $2.2 million
No. 10: Newport Beach waterfront estate with multi-boat dock lists for $58 million
No. 11: Costa Mesa approves plan to replace Fairview Center with 2,300 new homes
No. 12: 2-year-old Zia apartment complex sells in Anaheim
No. 13: California tenants suffered 8th-highest rent hikes in the US over four decades
