RISMEDIA, July 23, 2007—(MCT)—Landlords continue hiking rents in Ventura County, California.
The average monthly rent rose 7.2% to $1,542 in the second quarter from the same period a year ago, RealFacts, a market research firm, reported Wednesday.
Renters pay more to live in the county than people in San Francisco. The only places in California where people are paying more are in the Los Angeles and San Jose regions.
Landlords are going to take what they can in exchange for a small decrease in occupancy, said Bill Watkins, executive director of the UC Santa Barbara Economic Forecast Project.
The average occupancy rate over the same period dropped 2.6%.
“There’s a limit,” Watkins said of what landlords are charging. “But they’ll push the limit, certainly.”
Renters in Simi Valley and Camarillo have been the hardest hit. Simi’s average rent rose 12.2%, and Camarillo’s increased 12.8%. Meanwhile, Oxnard renters are paying 2.7% more. In Ventura, the average rent was up 7.6%, and Thousand Oaks rose 6.1%.
Most of the increases were well above the United States’ core inflation rate of 2.3%, as measured by the federal government.
The reason that property owners are able to keep increasing prices is because the “economy is strong and we haven’t had much supply added over the years,” Watkins said.
Rent would decline, he added, if more rental units were built, or there were a slowdown in demand, perhaps brought about by a major employer leaving. But Watkins said that’s not likely to happen.
“We don’t expect to see the military, government or Amgen leave,” he said.
Charles Maxey, dean of the School of Business at California Lutheran University in Thousand Oaks, echoed Watkins’ sentiments about rent rising with supply and demand. As long as people are willing to pay their asking price, property owners will ask for more, he said. “They’ll press it as much as they can.”
Local governments do have power to control the situation to some degree, however, by designing policies that allow for certain types of housing and issuing building permits based on that design.
Next spring, cities must submit such plans to the state, which has mandated that they document their needs in various categories of affordability over a five- to seven-year period, said Jill Fioravanti, special projects manager at the Cabrillo Economic Development Corp.
In the meantime, fewer people are renting. Occupancy rates fell to 93.8% from 96.4% the previous year.
As affordable housing goes by the wayside, experts foresee the county suffering in other ways.
For instance, local cities enjoy sharing in retail returns, but the retail outlets need staffs.
“Retail jobs don’t pay well so people have to commute,” Maxey said. “Commuting creates traffic, so the balance between what kind of jobs and housing you build is directly related to traffic.”
Another repercussion will likely be felt by homeowners who can’t find buyers and are trying to lease their homes, said Jayne Haggar, California Oaks Property Management manager.
“When the rents go up, multiple people — like students — want to rent a large home because the rent’s so high that it’s less expensive for them,” she said. “They try to rent a four- or five-bedroom house and split the cost instead of renting an individual one-bedroom apartment.”
Homeowners typically aren’t thrilled at the thought of leasing their property to a group of young people.
That said, with students coming to town, this is the best time of year to rent a house, Haggar said. “But to get a family they have to come down from what their expectations are.”
Copyright© 2016 RISMedia, The Leader in Real Estate Information Systems and Real Estate News. All Rights Reserved. This material may not be republished without permission from RISMedia.
Content on this website is copyrighted and may not be redistributed without express written permission from RISMedia. Access to RISMedia archives and thousands of articles like this, as well as consumer real estate videos, are available through RISMedia's REsource Licensed Content Solutions. Offering the industry’s most comprehensive and affordable content packages. Click here to learn more! http://resource.rismedia.com