California has some relatively affordable apartments – just don’t expect living near a seabreeze.
My trusty spreadsheet reviewed CoStar‘s third-quarter apartment stats that track 394 markets nationwide, including 28 in California. CoStar watches what’s happening with larger landlords who own complexes with five or more units. That’s a world of 21 million apartments nationwide — including 2.8 million in those California locales.
Now, I know paying rent is a real financial challenge for numerous Californians, as well as many Americans. But to locate some modest affordability in the Golden State, look at the 13 California markets CoStar tracks that are nowhere near the Pacific Ocean or San Francisco Bay.
For these inland markets, consider one measure of cost: the “effective” rent – what’s charged after various landlord discounts. Regional averages were weighted by the number of rentals.
Tenants in these inland California markets pay an average rent of $1,815 monthly. Those rents range from $2,094 in the Inland Empire to $1,227 in El Centro.
Very surprisingly, that average inland rent was only 4% higher than what landlords charge in the 366 markets outside of California.
Average rents in the rest of America ran $1,738 monthly – ranging from $3,626 in New York to $712 in Weirton, West Virginia.
Look, California’s major rental affordability issue lies closer to the coast.
Rents in these 15 other California markets average $2,610 monthly – 44% higher than inland California rents – ranging from $3,766 monthly in San Francisco to $1,553 in Hanford.
Rent rivalries
Ponder inland rents against what tenants pay in states considered California’s main economic rivals.
OK, they’re 37% pricier than what’s found in 26 Texas markets, where the typical tenant pays $1,328 monthly, ranging from $1,453 in Dallas-Fort Worth to $948 in Texarkana.
However, inland rents are roughly on par with what’s typically charged across 24 Florida markets. Typical Floridian tenants pay $1,838 monthly, ranging from $2,509 in Palm Beach to $810 in Homosassa Springs.
Rough affordability
Rents aren’t the entire story.
My spreadsheet looked at the financial burden on tenants using a very rough gauge of affordability: the ratio of rent to household income. Remember, renters usually earn less than a region’s overall wage levels.
My spreadsheet found a year’s worth of inland California rents equal 23% of the region’s $94,000 average-weighted income.
Surprisingly, that’s on par with the 23% of $91,000 incomes found outside of California.
Yes, Texas rents are only 18% of the state’s $89,000 incomes. But Florida rents run 26% of $83,000 incomes.
Of course, affordability is ugliest in coastal California, despite bosses handing out some lofty paychecks. These rents run 27% of $117,000 incomes.
“Tenant Talk” by Jonathan Lansner is a peek into the world of renting. Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
ICYMI:Here are the Southern California News Group’s most-popular real estate news stories for October:
No. 1: Dana Point’s Ritz-Carlton sells for estimated $600 million
No. 2: Laguna Beach estate sells for $82.6 million, second-highest OC home sale
No. 3: Newport Beach’s 100-year-old landmark Lovell Beach House seeks $18.8 million
No. 4: Southern California homebuying crashes to 2nd slowest pace on record
No. 5: ‘New Girl’ star Jake Johnson lists Pasadena home for $3.3 million
No. 6: 12 Orange County ZIPs on costliest housing list, 3rd most in nation
No. 7: Palos Verdes Estates oceanfront compound sells for record $24.3 million
No. 8: Home prices drop in 42% of Orange County
No. 9: Long Beach mid-century duplex photographed by Julius Shulman seeks $1.5 million
No. 10: Gains in California home prices continue to evaporate
No. 11: Real estate news: Costa Mesa apartment complex fetches $9.4 million
No. 12: Real estate news: Placentia shopping center trades hands for $66 million
No. 13: 69 California ZIP codes make priciest-housing list, the most of any state
No. 14: Laguna Beach’s ridge-cresting ‘Wave House’ seeks $7.9 million
No. 15: Rents are rising in 58% of Southern California cities
