The latest University of Southern California Casden Real Estate Economics Forecast predicts that rent prices will continue to rise in the region over the next two years. However, despite the economy’s resilience, there is still a shortage of housing in the area.
According to Moussa Diop, associate professor of real estate at USC Sol Price School of Public Policy and author of the forecast, while fighting inflation, the Federal Reserve has successfully achieved a soft landing by keeping mortgage rates high. However, this has not been enough to address issues with new housing supply and affordability.
Diop explains that as mortgage rates slowly drop and improve market conditions for homebuyers, there has been a slowdown in construction which is concerning given how tight supply already is. In comparison to states like Florida and Texas where construction activity remains strong, California is falling behind when it comes to addressing its housing needs.
The annual forecast provides insights into current and projected multifamily rents and vacancies for five regions: Los Angeles County; Orange County; San Diego County; Ventura County; and Riverside/San Bernardino counties (Inland Empire). It covers an eight-quarter period from now until 2022.
