The LA rental industry continually evolves, and the failure to catch up with the trends may spell trouble for your investment’s growth. What trends can you expect for the Los Angeles rental market in 2021, and how can you take advantage of them? Experts at RTI Properties Inc have got you covered with 2021 LA rental market trends to watch. Read on to learn them.
2021 LA Rental Market Trends Are:
Generation Z is Entering the Market
Millennials, now aged between 24 and 39 years, once accounted for the largest share of renters in Los Angeles. However, the dip in mortgage interest rates has seen this population segment significantly shift to homeownership in the past decade. Enter Generation Z, now in their early and mid-twenties and trying to figure a sense of direction for their lives. And overly reliant on technology.
Gen Z is the first population segment that has never known a world without the web, spending at least three hours on social media daily. Given this trend, the need to spend more resources on online marketing and growing your online presence cannot be underscored enough. You also need to improve your listings’ visuals-make them alluring and let them highlight the best features of your property. We also expect to see a surge in demand for virtual tours.
Even as you elevate your real estate marketing strategies, it is also wise to focus on your property appeal. Keep your prices competitive. And Add some modern touches, from adding a fresh coat of paint to installing modern lightings and energy-efficient appliances.
The Growing Demand for Technology
As the Los Angeles rental industry grows, so does the demand for tech solutions in Rental Management. From payment processing, communication among property owners, tenants, and property managers, new technologies are increasingly shifting several aspects of rental property management in Los Angeles. And the faster you adopt these tech solutions, the quicker you gain an edge over the hordes of competitors in your neighborhood.
Some of the areas you can improve with technology include:
- HVAC systems: Smart thermostats can offer incredible savings on energy bills, prevent mold growth by maintaining humidity at acceptable levels, and prevent HVAC system damage.
- Property access: Renters can create specific codes for friends, family, and service providers to access their units exclusively, with all access being tracked in event history.
- Water usage: Water leak sensors can help you eliminate costly repairs associated with interior and exterior water damage. A smart water shut-off valve allows you to turn the water off remotely during emergencies.
- Lighting: Smart light switches, smart light bulbs, and plug-in modules are sure to provide much-needed convenience to renters.
Related Article: Property Management Tips To Upgrade Your LA Property in Budget
Rent Control is Gaining Traction
Los Angeles apartments are among the country’s priciest, with millions of residents stuck paying for high-priced rentals. Accordingly, LA City has made rent control regulations, referred to as rent stabilization ordinance (RSO), to make it easier for middle- and low-income earners to find a place to live. Most of these rules apply to apartments offered Certificate of Occupancy not later than October 1978. Buildings constructed between late 1978 and 2005 are subject to California rent control laws. Other cities in and near LA have their own rent control regulations.
But note that the LA RSO limits increase as per the changes in Consumer Price Index. The current RSO prohibits rent-controlled units from hiking their prices lower than 3% and higher than 8% in a year. The present allowable increase is 3% through June 2021. However, in some circumstances, apartment owners may increase rental prices beyond the allowable limit, provided they prove that they are receiving an unfair return on their investment.
Growing Demand for Top-Quality Property Management
Being a successful landlord and enjoying a healthy return on investment in 2021 will be primarily about looking after your investment. Fair enough, most landlords take care of their properties. Top-quality property management, however, is staying abreast of any problems before they spiral out of control and optimizing tenant experience. This means spending a significant amount of time inspecting your property and noting down any issues that require attention. But you will want to address the issues as quickly as possible. Whereas you may perform some repairs by yourself, hiring licensed and trusted contractors goes a long way to mitigate costly mistakes and lower your maintenance costs.
There is much more to rental management, and it helps to work with a property management company in Los Angeles. You get high-quality & long-term tenants, lower maintenance and repair costs, faceless legal problems, enjoy more efficient rent collection. And most importantly, you get more freedom and time to focus on other essential life aspects.
Promising Rental Growth
While California boasts a 1.61% year-over-year increase in rental prices, statistics reveal that the average rent in Los Angeles surged by a whopping 65% in the past decade, although the prices change up to 2% from month to month. Between 2018 and 2019, LA rental prices rose by 7%, with this upward trend expected to continue.
However, COVID-19 has seen apartment rents in LA declined by 6% in 2020, with the high-end units bearing the brunt due to increased vacancies. Still, more people are considering homeownership, thanks to the lower mortgage rates. Therefore, we do not expect to see much growth in rental prices in 2021, meaning a generally happier market of tenants. As we recover from the pandemic’s bites, we expect the rental prices to gradually catch up with the growth rate projected before the pandemic hit the nation.
Also Read: Southern California Rental Market Outlook
Keeping up with the market trends is paramount to maximize your opportunity in rental investment in LA in 2021. As Gen Z enters the market, apartment owners must be ready to adopt more tech solutions for maximum comfort, convenience, and satisfaction of this population segment. All in all, the need for high-quality apartment management cannot be ignored, regardless of the population segment, your target.
If you are struggling with driving tenants to your apartments or keeping an eye on your rentals, RTI Properties Inc. has got you covered with some of the best property management services in Los Angeles. We can leverage industry trends to your advantage, ensuring you enjoy a healthy occupancy rate, keep your tenants happy, and reap the profits you desire. Call us today at 310-532- 9122 for a free consultation and learn how the above trends apply to your rentals.