A pandemic-weakened economy has chilled rent hikes in Los Angeles and Orange counties to the smallest increase in nine years.
The cost of renting rose at a 1.6% annual rate in November vs. 5.4% a year earlier, according to a slice of the local Consumer Price Index. It’s the smallest gain for any November since 2011.
The U.S. Bureau of Labor Statistics’ CPI tracks rental costs by polling consumers vs. other measurements that come from surveys of landlords. Those industry metrics show landlords’ “asking rents” falling in many parts of the region.
Property owners have been forced to discount empty units as service industries that primarily employ renters have been hammered by business restrictions. More remote work has allowed other renters to move inland where rents are cheaper. Rents in Riverside and San Bernardino counties have cooled but are nowhere near coastal rates. Inland Empire rents rose at a 2.9% annual pace in November vs. 4.8% a year earlier.
We can also look at rent weakness in L.A.-O.C. this way: Increases run well below the average 5.5% gain in 2019 or the 4.6% of 2015-2018. This year looks more like the 2009-14 period when local rents rose on average 1.7% annually.
These slight rent hikes were one reason why overall L.A.-O.C. inflation was rising at a 1% annual pace in November vs. 3.2% a year earlier. L.A.-O.C. inflation averaged 3.1% in 2019, 2.3% in 2015-2018 and 1.3% in 2009-14.
Here are other L.A.-O.C. cost-of-living trends you should be watching …
The big picture: L.A.-O.C.’s 1% overall inflation rate is running below the nation’s 1.3%, while CPI in Western states rose at a 1.5% pace.
Inland: 2.1% overall inflation last month for Riverside and San Bernardino counties.
Elsewhere in the West: San Diego CPI? Up 1.9% annually and 1.8% for urban Hawaii.
Inside the local report, we learned …
Fuel: Gasoline in L.A.-O.C. cost 22.1% less in the last 12 months, by CPI math. Household energy costs 12.4% more.
Food: Groceries rose 2.8% as eating out got 5.3% pricier.
Medical: Bills were 4.5% costlier.
All local services: 1.7% pricier.
Apparel: Clothing was 2.6% costlier.
Big-ticket items: The cost of “durable goods” (such as appliances and furniture) was 1.4% higher.
Vehicles: New? 0.9% pricier. Used? 10% pricier.
Source: Orange County Register