For those who question reports showing that Southern California landlords are in price-cut mode, let me offer a slightly different\u00a0 \u2013 and newer \u2013 snapshot of what\u2019s up with local rents.<\/p>\n
My trusty spreadsheet<\/a> had a harder time identifying rent declines when reviewing August rent data for 57 Southern California cities provided by ApartmentList. These price estimates, a combination of statistics from the government and ApartmentList\u2019s listings for apartments and houses, tracked the overall one-year change in rents for one- and two-bedroom units.<\/p>\n While there was no widespread, major rent hikes, the stats suggest a possible end to noteworthy discounting in many cities. Consider August\u2019s results vs. March, just five months earlier.<\/p>\n Across Southern California, ApartmentList\u2019s overall rent indexes in the year ending in August declined in 23 of 57 cities, rose in 32, and were unchanged in two. So, we have good news for tenants in 40% of the region.<\/p>\n However, back in March, rents were down in 62% of the region\u2019s cities.<\/p>\n Whatever this change represents \u2013 a rent bump or blip \u2013 let\u2019s note that regional pricing is making a thin move.<\/p>\n Southern California\u2019s overall rent indexes across 57 cities averaged a 0.3% year-over-year gain in August, compared with a 0.6% decline in March.<\/p>\n Split picture<\/p>\n This summer\u2019s minor rent swing may be tied to economic stability rather than a major shift in business conditions.<\/p>\n Yes, some landlords still offer discounts to fill empty units, as rental supply is up in certain parts of Southern California due to a modest uptick in construction.<\/p>\n But other landlords see higher demand for their rentals due to the region\u2019s slow but steady job growth, plus there\u2019s the long-standing inability of homebuyers to find anything affordable.<\/p>\n Curiously, landlords are more likely to be discounting in the region\u2019s lower-cost communities. You see this when you compare the 10 Southern California cities with the biggest one-year rent dips with the 10 with the biggest gains for August.<\/p>\n Average one-bedroom rents in the cities where rents tumbled were 25% lower than those in cities where rents jumped. For two-bedroom rentals, the gap was 22%.<\/p>\n This is a reminder that despite all the talk of a certain level of economic resilience, individual outcomes are split, with those of lesser means often hit harder.<\/p>\n Just consider the region\u2019s price-swing extremes relative to median household incomes.<\/p>\n Rents in Aliso Viejo, where average incomes run $141,000, are up 5.1% in a year \u2013 the biggest gain. In Pomona, where incomes average $89,000, rents fell by 5.1% \u2013 the largest decline.<\/p>\n It could be worse<\/p>\n In August, the typical Southern California tenant paid an average of $2,020 a month for a one-bedroom and $2,440 for a two-bedroom across the 57 cities.<\/p>\n Dare I mention the financial hurdles a local house hunter faces?<\/p>\n By one calculation, a Southern Californian homebuyer would have had to shell out $4,600 a month for a median-priced condo, which cost $665,000 in May.<\/p>\n That\u2019s more than double the typical local rents, and it covers only the mortgage, property taxes and insurance. Do not forget the $67,000 in cash for the down payment required to make this purchase work.<\/p>\n Market math<\/p>\n Here is another subtle reminder that the odds are shrinking for a Southern California tenant seeking a rental bargain.<\/p>\n Just three of Southern California\u2019s five rental markets saw prices fall in the past year through August, compared with four in March.<\/p>\n Geographically speaking, discounting is more intense the farther north you go. Just peek at those pricing patterns, with the five markets ranked by their share of cities with rent one-year dips:<\/p>\n \u2013 Inland Empire: Rents were down in 8% of its 13 cities in August. Quite the change from March, when 75% of the markets had rent declines. August\u2019s one-year average price move was a 1.3% increase, compared with March\u2019s 0.7% decline. August rents were $1,690 for one-bedroom units and $2,030 for two-bedroom units. Pricing extremes? Colton, up 4%, to Fontana\u2019s 2.6% dip.<\/p>\n \u2013 Orange County: declines in 13% of 16 cities in August vs. 27% in March. August\u2019s one-year price move: 2.1% increase in a year vs. March\u2019s 0.6% gain. August rent: $2,380 for one bedroom and $2,840 for two. Pricing extremes? Aliso Viejo, up 5.1% to Santa Ana\u2019s 2.1% dip.<\/p>\n \u2013 San Diego County: Declines in half of its eight cities in August vs. 63% in March. August\u2019s one-year price move: 0.1% drop in a year vs. March\u2019s 1.8% decline. August rent: $1,840 for one bedroom and $2,240 for two. Pricing extremes? Carlsbad, up 1.7% to Escondido\u2019s 2.5% dip.<\/p>\n \u2013 Ventura County: Declines in 80% of five cities in August vs. 80% in March. August\u2019s one-year price move: 2.4% drop in a year vs. March\u2019s 1.9% decline. August rent: $2,010 for one bedroom and $2,410 for two. Pricing extremes? Thousand Oaks, up 0.1%, to Oxnard\u2019s 3.7% dip.<\/p>\n \u2013 Los Angeles County: Declines in 80% of 15 cities in August vs. 85% in March. August\u2019s one-year price move: 1.6% drop in a year, same as March. August rent: $1,970 for one bedroom and $2,460 for two. Pricing extremes? Torrance, up 1.6%, to Pomona\u2019s 5.1% dip.<\/p>\n Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com<\/a><\/p>\n Try Jonathan Lansner\u2019s Substack collection of economic trends. CLICK HERE<\/a>!<\/p>\n August\u2019s most-popular Southern California real estate stories \u2026<\/p>\n No. 1: Where is OC\u2019s hottest homebuying neighborhood? <\/a><\/p>\n No. 2: 338-unit affordable housing complex breaks ground in Tustin <\/a><\/p>\n No. 3: Peek inside this Newport Coast estate that sold for $39M <\/a><\/p>\n No. 4: Enderle Center sold, Campo on 17th moves ahead in Tustin <\/a><\/p>\n No. 5: Rents rise in just 22% of SoCal. See which cities got hikes <\/a><\/p>\n No. 6: Home prices dip in 38% of OC. How did your ZIP do? <\/a><\/p>\n No. 7: LA-OC\u2019s worst-paying jobs: Can those wages pay the rent? <\/a><\/p>\n No. 8: LA-OC homes still \u2018unaffordable\u2019 even with a 0% mortgage <\/a><\/p>\n No. 9: Corona del Mar retail center trades hands, a first in 80 years <\/a><\/p>\n No. 10: California housing is frozen, but not underwater <\/a><\/p>\n No. 11: Newport Beach reduces affordable housing near JWA <\/a><\/p>\n No. 12: California\u2019s $627,000 average equity ranks No. 2 in US <\/a><\/p>\n No. 13: Rancho Mirage estate by architect Robert Stone seeks $7.25M <\/a><\/p>\n No. 14: Newly built waterfront estate in Big Bear Lake lists for $15 million <\/a><\/p>\n No. 15: OC has 62 million-dollar ZIPs. Is yours on the list? <\/a><\/p>\n No. 16: 65 units of affordable housing in Midway City stacked into place <\/a><\/p>\n No. 17: New waterfront estate in Big Bear Lake lists for $15M <\/a><\/p>\n No. 18: Office broker sees potential in Dana Point, San Clemente <\/a><\/p>\n No. 19: SoCal home prices hit record $840,000. Don\u2019t cheer. <\/a><\/p>\n