JLL Says Homeownership Is Down In LA
Fewer people are buying houses in LA these days, according to a recent JLL study.
Compared to other parts of California, LA has one of the lowest homeownership rates, coming in at 46.5%.
That is way below the national average of 62.9%.
JLL Capital Markets SVP Patrick Inglis (pictured in Lake Tahoe with his wife, Samantha, and son, Luke) tells Bisnow LA’s low homeownership rate, which also falls below rates in San Francisco, San Jose and San Diego, is largely due to increases in home prices “outpacing the rate of wage growth.”
This has resulted in a “significant affordability gap” between household income and median home prices, according to Patrick.
An added factor is Millennials who prefer to rent instead of buy.
The decreased number of people buying homes is affecting multifamily since "strong rent growth, low occupancy rates and rapid absorption of new product" have caused unit sale prices to shoot to higher levels.
The LA vacancy rate when it comes to multifamily is at 3.3%, a historic low, according to JLL. The national average is 6.7%.
Patrick predicts the trend will continue.
The trends affecting multifamily in Southern California is one of the topics at our Future of SoCal super-regional event on Nov. 15.
