LA is the fifth worst big metro for renting, according to Forbes, after only New York and the Bay Area
Today in Bad News for People Who Rent Their Homes, Forbes decided to put together a list of best and worst cities for renters. Guess which one of those lists Los Angeles is on. Those who guessed “worst” are right! Congratulations for guessing correctly and condolences if you are a renter, though you probably already knew that Los Angeles has been growing increasingly unaffordable for you.
Ok, ok, but how bad is LA for renters? As far as the top 10 go, LA was just number five. Just number five? The number one spot went to Manhattan, where the average rent in the last quarter of 2015 was a truly painful $4,374, while the second, third, and fourth slots all went to the Bay Area (Oakland, San Francisco, and San Jose, respectively).
To come to its conclusions, Forbes (with data from Marcus and Millichap) looked at the average rent in the last quarter of 2015, the vacancy rate, the average share of household income spent on rent (multi-family units only), and the year-over-year changes in rents for 50 of the largest metro areas in the nation.
What they found for LA was that the average monthly rent amounted to $1,892. With an average household income of $58,023, that means rent gobbles up roughly 39 percent of that cash. (Half of each metro’s score was based on the straight cost of renting.) LA’s tiny 3 percent vacancy rate and big 6.1 percent year-over-year increase in rent sealed the deal. It’s still about $700 dollars cheaper to rent than own in LA, Forbes found, but with housing prices being as high as they are, there’s a pretty good chance most renters are staying put anyway.