CITYWIDE ‚Äî News flash: Apartment and house rentals on the Westside are (still) expensive.
Data released by Lovely, a web aggregator of rental information, estimates that the average renter can plan to spend $3,400 per month for housing in Santa Monica, with one bedroom units hitting $2,900 and two and three bedroom units averaging $1,800 a room.
That makes the city by the sea third most expensive of 93 cities and neighborhoods evaluated by the site behind only Bel Air and Pacific Palisades at $4,324 and $4,499 respectively.
Santa Monica properties move quicker than apartments in either of those locales, however, averaging 22 days on the market compared to 26 in Pacific Palisades and 34 in Bel Air, according to the site.
Between time spent on the market and the price, a person searching for an apartment as the busy summer months begin can get a sense of which neighborhoods are “hot.”
Three weeks is the upper end of the “normal” range in markets like Los Angeles and San Francisco with more demand than supply, said Elizabeth Pietrzak, communications and marketing lead at Lovely.
“Less than 10 days on the market, like eight days, is really quick,” Pietrzak said. “The sweet spot is the two to three week mark.”
Lovely gets its numbers from an extensive database accumulated from 50 partners that include national sites like Craigslist and locals like Santa Monica-based Westside Rentals, Pietrzak said.
“Any piece of listing data or rental data that you might find on all of the fragmented search engines, we aggregate on our site,” Pietrzak said.
Numbers in the Lovely report are considerably higher than official Santa Monica sources, which either have not been updated recently or include rent-controlled units and their artificially low rents.
Market rents in 2011 hit $1,595 for a one bedroom apartment and $2,150 for a two-bedroom unit, according to a report from the Department of Housing and Economic Development. Three bedroom units didn‚Äôt crack $3,000.
More recent numbers from the Rent Control Agency show rents coming up to market rate in higher numbers as a result of vacancy decontrol.
Roughly half of rent-controlled apartments in Santa Monica have been brought up to market rents in the last four years as a result of high turnover, according to the report.
The Lovely report, which relies on data from the past year, may reflect a rental market that has caught fire as the classic calculus of supply and demand forced prices to the sky, said Beverly Kenworthy, executive director of the California Apartment Association‚Äôs Los Angeles division, an organization that primarily represents developers that also operate the buildings they make.
Building in the Los Angeles area is an expensive proposition, one that relatively few developers have felt compelled to take on, Kenworthy said.
“We‚Äôre not seeing a lot of projects at higher rental rates because it‚Äôs so expensive to build,” Kenworthy said. “Then you see places like Santa Monica with not much new supply. It‚Äôs pretty simple math.”
Rents in Westside cities and Downtown L.A. have increased by nearly 20 percent since the most recent low, and renters that signed cheap leases just a couple of years ago are having difficulty keeping up, according to a report by Marcus & Millichap, a commercial real estate brokerage firm that specializes in real estate investment services.
The company expects rents to continue to climb 4.5 percent from the end of last year despite an increase in vacancy rates, according to the report.
The base cost of land in the Southland is a major factor, but demand for new apartments, the loss of cities‚Äô ability to develop affordable housing and the rising cost of basic necessities like water and electricity have created a perfect storm, Kenworthy said.
Whatever the root of the high housing costs, they create an untenable situation for a new generation of people who want to live and work in Santa Monica, said Councilmember Kevin McKeown.
Finding ways to bring those rents down doesn‚Äôt just attract new blood, it solves a number of Santa Monica‚Äôs social and environmental goals, he said.
“Affordable housing near living wage jobs will reduce traffic congestion and parking problems. Market rates on new rents reflect how desirable Santa Monica is, but excluding new young renters and working families who can‚Äôt afford exorbitant rents is unsustainable and socially unjust,” he said.
Creating housing that people without high-end tech jobs can afford is a challenge.
A report by the National Low Income Housing Coalition in early 2013 showed that the average California worker would have to make $25.78 per hour if they planned to work 40 hours per week and spend no more than 30 percent of their income on rent, the standard put forward by the federal Department of Housing and Urban Development.