雅虎香港財經 4 In 10 Los Angeles Renters Fear Eviction Because Of High Rents
Nearly 4 in 10 Los Angeles County apartment renters fear they will face eviction and homelessness in the next several years, according to a recent University of California, Los Angeles survey.
It's a sad reality that Los Angeles is becoming more famous for its high cost of living than its beaches and year-round sunshine, but the study results speak volumes. L.A. has one of America's largest homeless populations and many residents fear they could be next.
Los Angeles used to be a city where young people went to "make it big" in their chosen profession. Increasingly, it is becoming a city where anyone earning less than a six-figure income will be hard-pressed to make ends meet. The survey, conducted by the Luskin School of Public Affairs as part of its 2024 Quality of Life Index, reveals some troubling truths about where Angelenos see themselves and their futures.
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The study results are clear: Los Angeles's high cost of living is hurting the quality of life for its residents, many of whom fear they can't keep up. Less than 25% of renters surveyed believed they would be able to purchase a home in an L.A. neighborhood where they wanted to live. It's not difficult to identify with their fears, especially considering that the average Los Angeles home costs nearly $1 million.
Bear in mind that $1 million is the average price. That means homes in Los Angeles's traditionally challenged neighborhoods sell in the mid to high six-figure range. By contrast, Zillow reports the average home in Beverly Hills is roughly $3 million — a nearly 200% increase over the average Beverly Hills home price in 2000 of around $1,000,000, according to the Southern California Association of Governments.
One significant kick-on effect of high home prices is that they leave Los Angeles apartment owners with a captive rental audience. Apartments in Los Angeles were temporary housing 20 to 30 years ago. Many area renters eventually became homebuyers because they didn't have to be movie stars or tech company executives to afford homes in desirable areas.
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Middle-class professionals like teachers and firemen were priced out of Beverly Hills in 2000, but they had options in areas like the San Fernando Valley or L.A.'s outlying suburbs. Now, they are permanently priced out of the Los Angeles County housing market, making them permanent renters. Unfortunately for them, rents are on the same upward trajectory as home prices. Zillow reports the average rent in Los Angeles is roughly $2,700 per month.
The standard qualification ratio for an apartment rent or mortgage payment is three times the monthly obligation. If the average rent is $2,700, a renter needs to make around $8,500 per month (over $100,000 annually) to qualify. Even in a city like Los Angeles where the cost of living was relatively high, crossing the $100,000 annual salary mark used to be where most people could stop living paycheck to paycheck and begin saving for retirement.
Now, $100,000 barely gets Angelenos through the front door, and most Los Angeles renters don't make anywhere close to that. It explains why 4 out of 10 Los Angeles County residents fear eviction and are pessimistic about their futures in the area. This level of angst and apprehension about living in Los Angeles is a relatively new phenomenon.
It's also a factor investors should consider before buying property in the L.A. area. Historically, they have been able to rely on steady returns from rent increases. However, as renters' dissatisfaction with life in Los Angeles increases, along with their fear of becoming homeless, it's only a matter of time before L.A. rents hit a glass ceiling. They may be bumping up against it already.
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