Los Angeles Multifamily Report – Summer 2020
- Sep 18, 2020
More than four months into the global health crisis and amid a series of methodical steps taken toward recovery, Los Angeles multifamily fundamentals are feeling the pinch of the ongoing economic disruption. As of July, metro Los Angeles rents were down 0.4 percent on a trailing three-month basis, 30 basis points below the U.S. rate, with the average $2,159, however, well above the $1,469 U.S. figure.
As of June, metro Los Angeles unemployment rate stood at 18.1 percent, the largest jobless rate among the country’s 30 largest metros and well above the 10.2 percent national figure. Los Angeles unemployment rate surpassed even the hardest-hit, leisure-driven economies such as Las Vegas (18.0 percent) and Orlando (16.5 percent). The resurgence of coronavirus cases across California is hindering recovery efforts, keeping restrictions in place and furthering economic uncertainty.
More than 9 million unemployment claims have been processed in California since March, with $55 billion in benefits paid out already. After peaking in 2016 at 11,108 units, deliveries in the metro moderated slightly. Developers added 3,138 units to inventory year-to-date through July, a number that’s already almost on par with the decade’s cycle low in 2012, when 3,274 units came online. The pandemic has also dampened transaction activity—some $965 million in assets sold through July, a 56 percent drop compared to the same interval last year.