Tons of new apartments opening Downtown means landlords are offering lots of perks to attract tenants, who now have a lot more choices in the neighborhood. The LA Times reports that many of those recently opened developments are offering new renters a month of free rent. At the Eighth + Grand complex above the Whole Foods in Downtown, new residents can get up to five rent-free weeks and as much as a year of free parking. A Hanover project on Olive Street and a Sares-Regis Group complex in Little Tokyo are offering a free month rent.
These previously rare "concessions" aren’t the norm yet, but as more of Downtown’s plentiful under-construction apartment complexes come online, they are expected to become more commonplace. This year alone, 1,688 apartments have opened in Downtown; in the last year and a half, over 3,700. 6,260 more apartments under construction in the neighborhood right now.
A senior analyst with CoStar Group Inc., Steve Basham, says that because of all these new units on the market, "Landlords don’t have the leeway to push rents as they did in the past. Renters have many more options than they did even six months ago." He believes that, from a developers’ point of view, Downtown might be heading towards oversupply.
Downtown’s apartment boom hasn’t just meant more perks for renters. It’s also translated into slower rent growth in the neighborhood compared to the rest of the city, where apartment building hasn’t been as vigorous.
According to real estate website Zillow, the median rent for all multifamily units citywide rose 7.2% in June to $2,446, compared with a year earlier, while the median climbed 3% downtown to $2,437 a month, where many units are studios.
Unfortunately, perks and free rent giveaways Downtown seem to be confined to the higher-end rental properties. In older, traditionally less expensive buildings, rents haven’t leveled off at all. In fact, they’ve continued to rise. And while high-end apartments have become easier to find, "Trying to find anything under $2,000, even as a studio, is hunt and peck," Downtown rental agent Robyn Joy of The Rental Girl tells the Times.
- As new apartments flood downtown L.A., landlords offer sweet deals [LAT]
- All the Stats on DTLA's Biggest Housing Complex, Eighth & Grand [Curbed LA]