New numbers out from the US Census Bureau show that the rental vacancy rate in the Los Angeles metro area (which includes Long Beach and Anaheim) dropped down to just 2.7 percent in the last three months of 2015. That's down from 3.8 percent at the beginning of 2015, says KPCC, and well below the national average of 7 percent. Los Angeles—where a majority of residents are renters and housing supplies are low—has long had a low vacancy rate, but these super-low numbers are part of a downward trend; even back in 2010, LA's vacancy rate was around 6 percent. At the end of 2015, the only "major" metro areas with lower vacancy rates than LA were San Jose, CA; Portland, OR; and Allentown, PA.
Los Angeles has the highest rate of renters in the nation, at 52 percent, according to a Harvard Joint Center for Housing Studies study, and there isn't nearly enough new housing being built. (The city's working on that.) KPCC says that one additional contributing factor to the low vacancy rate is the amount of young people in LA, who rent because they like "the flexibility that a rental offers," which perhaps is a nice way of saying the average Millennial can really only afford to spend about $110,000 on a house, which in LA basically means they can not buy a house. (The median price in the area is $575,000.) Whatever the reason, all that demand and not enough supply usually means rents will rise.
· LA rents: Vacancy rate falls to 2.7 percent as area's rental market tightens further [SCPR]
· 58.5 Percent of Los Angeles Renters Can't Afford Their Rent [Curbed LA]