The cost of renting an apartment in Los Angeles is forecast to rise 10 percent over the next two years, and foreclosures are partly to blame for driving demand and prices, it was reported today.
During the first quarter of the year, the average rent nationwide was $1,008 per month, surpassing the previous all-time high set in the third quarter of 2008, the Los Angeles Times reported based on data from RealFacts.
Aside from foreclosures driving people out of homes and into apartments, rising demand by young people is driving rents up, the Times reported.
Westsiderentals.com is operating 14 hours a day to meet demand from renters. The company has even seen a bump in interest for its "platinum" relocation service, which offers to chauffeur clients to listings.
Most Santa Monica landlords list their apartments with the company, which operates seven offices, including one on Wilshire Boulevard at 10th Street.
The real estate crash has made owning a home more affordable than renting in some markets.
An index by the research firm Green Street Advisors compares buying with renting in 79 metro markets. That index hit its most attractive point last year for buying since 1991, when the firm began tracking the data. Researchers calculate that the after-tax cost of a mortgage is only 10 percent higher than what it costs to rent nationally after taking into account mortgage rates, property taxes and other factors.
USC's Lusk Center for Real Estate predicts the trend will continue, with rents rising 10 percent over the next two years.
Alaia Williams, 27, recently moved out of her mother's Inglewood apartment to be nearer to her job at a She and a roommate are splitting the $1,400 rent on a two-bedroom apartment in Palms.
"We can't afford to live" closer to work, she said.
Ellie Balderrama, who lists properties in Los Feliz, Silver Lake and Atwater Village for TheRenterGirl.com, said that as many as 20 people have showed up at some of her open houses. The ones who win arrive with completed rental applications and deposits in hand.
"In L.A., people have gotten so used to how relaxed it was, they are not aware how competitive it's become," Balderrama said. "Some people have got it, and some people don't, and the ones that don't suffer."