L.A. Investment Activity Endures
Amid fears of a recession and high inflation, most U.S. metros recorded a slowdown in multifamily rent development, cooling off after record gains last year. Los Angeles followed this pattern, with rent growth at 0.4% on a trailing three-month (T3) basis through September, to an average of $2,588—remaining well above the $1,718 national average. Demand remained relatively strong, however, and the occupancy rate in stabilized properties stood at a healthy 96.7% as of August.
The metro’s unemployment rate held at 4.5% as of August, above the nation’s 3.7%. California regained nearly all jobs lost during the height of the pandemic, according to the state’s Employment Development Department. During the 12 months ending in July, Los Angeles added 174,000 jobs, representing a 5.8% expansion. All sectors recorded gains, except for government, which lost 5,500 positions. The largest increases were in leisure and hospitality (37,600 jobs), trade, transportation and utilities (34,100 jobs) and education and health services (32,000 jobs).
Investment remained strong, with $4.6 billion in sales year-to-date through September, up more than 50% compared to the same time frame last year. Completions slowed, with 5,773 units added through September, or 1.3% of existing stock, 20 basis points below the U.S. rate and down 36% from 2021.
Read the full Matrix Multifamily Los Angeles Report-November 2022