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Here's recent history of the Fed’s policy committee and its Fed Funds rate. Next Fed decision is June 24/25.
O.C.’s empty apartments seen at 6-year high
July 20th, 2008, 11:59 am · 46 Comments · posted by Mary Ann Milbourn
Renters, rejoice! Axiometrics Inc. reports vacancies in Orange County’s largest apartment buildings continued to move higher in the second quarter, hitting 5.8% — highs not seen since the two quarters following the 9/11 terrorist attacks in 2001. A year ago, vacancies were at 4.4% in the second quarter.
The Dallas-based analytics firm is forecasting the vacancy rate will jump to 6.3% by year’s end, the highest in the 12 years the company has been keeping records. Axiometrics’s numbers are based on a survey of 66,494 units in 237 buildings.
In another sign of slowing, average O.C. rents hit $1,672, up 1.8% over the last 12 months, but only a 0.3% increase from the first quarter, which was down for the previous three months.
“It looks very weak, especially for your market,” says Jay Denton, Axiometrics vice president.
| OC vacancy rates | |
|---|---|
| Quarter | % |
| 2Q07 | 4.4% |
| 3Q07 | 4.3% |
| 4Q07 | 4.8% |
| 1Q08 | 5.6% |
| 2Q08 | 5.8% |
*Based on 66,494 units in 237 buildings
Source: Axiometrics
Related stories:
- SoCal rent hikes return to ‘02-’03 levels
- 2 O.C. men charged in Carlsbad rent scam
- June’s unkind to Wall Street’s real estate
- Insider Q&A hears O.C. rents to be ’stagnant’ for a year
July 20th, 2008 at 12:38 pm
The housing trainwreck is just getting started. Layoffs have been happening for the past 8 months and will continue. All the unemployed people from the housing industry are starting to run out of HELOC/savings money. It will be years, not months, of downward pressure on prices. The recession is just beginning.
If you buy a house now, no matter if it is the lowest listed price in the area, you WILL lose money. Of Course, if you can wait 15 to 20 years monetary inflation will help you break even. The problem is who knows what will happen 2 decades from now.
July 20th, 2008 at 12:42 pm
And you know this because you are a Democrat and Chucky Schumer is just getting started on causing runs on regional banks
July 20th, 2008 at 12:58 pm
R.A.T.
You are absolutely correct………buy now hold for 10 to 15 years to see the value come back to todays prices. This slowdown is just starting……..this time next year will be the real start of the slowdown…….and we will see some real price declines…………….
July 20th, 2008 at 1:18 pm
This is impossible, I was told that OC population keeps growing (oops it’s not) and land was limited and prices would keep going up.
July 20th, 2008 at 1:28 pm
Yo Seeking, you forgot to blame Obama for forcing banks to invest in a fake economy, a.k.a. the home “ownership society”.
July 20th, 2008 at 1:42 pm
If you think apartment vacancies are going up now, there’s a major tce water contamination problem in irvine that will likely cause apartment vacancies to go up even more.
July 20th, 2008 at 2:05 pm
And he forgot to blame Bill Clinton…
July 20th, 2008 at 2:25 pm
SEEKING ALFALFA (THE DING A LING OF ALL)
THE ONLY PEOPLE TO BLAME ARE THE IGNORANT PEOPLE LIKE ALF.
REMEMBER HE WAS ONE OF THEM SAID THIS COULDNT HAPPEN RENTS ONLY GO UP VACANCIES ARE GOING AWAY AND HOMES NEVER LOSE VALUE. AND ORANGE COUNTY IS DIFFERENT THAN ANY WHERE ELSE..
IT CANT HAPPEN IN ORANGE COUNTY
LOLLLLLLLLLLLLL
ITS PEOPLE LIKE YOU ALF THAT HAS DESTROYED PEOPLES LIVES AND THE ECONOMY
July 20th, 2008 at 2:58 pm
Hwood, phucque ewe eh whole
July 20th, 2008 at 3:08 pm
ALFALFA SPROUTS FOR BRAINS
IS THAT A NEW ALFALFABONICS TALK……….LOLLL
THE MORE U BLOG THE WORSE YOU SHOW HOW
UNEDUCATED U ARE…
NANCY REAGAN WAS RIGHT ALF
JUST SAY NO TO DRUGS!!!!!!!!
July 20th, 2008 at 3:15 pm
the only thing we can blame for the lending industry and the housing decline is greed it finally caught up . unfortunately the ones that suffered the most are the average, lower income hard working people who trusted in there investment.
July 20th, 2008 at 3:17 pm
I mean it moron, you can step in front of a truck anytime. You are without a doubt the most useless piece of human debris that ever escaped planned parnethood.
July 20th, 2008 at 3:37 pm
ALFFY
STEP IN FRONT OF A TRUCK ANYTIME U SAY
HMMMMMMM
JUST BECAUSE U HAVE DONE IT DOESNT MEAN ITS GOOD FOR ME….LOLLLLLL
ALFFY DONT U NEED TO BE AT LEAST 18 TO BLOG U MAY WANT TO GET PERMISSION SLIP FROM MOM TO CONTINUE LOOKING SO RIDICULOUS….LOLLL
MAYBE UR MOM WAS THE ONE DRIVING THE TRUCK THAT DID HIT YOU……….
July 20th, 2008 at 3:41 pm
The place I live has a ton of vacancies and people moving in and out all the time. My rent has only gone up $50 in 3 years.
This only further hurts the rent vs. buy arguement as rents decrease, prices will have to follow.
The incentives of home ownership right now are minimal and it does appear that it will only get worse. I almost bought in April of 2007….I am so thankful that I didnt. I feel 100K richer by not doing so.
…and alfalfa politics having nothing to do with it. This is all about greed.
July 20th, 2008 at 3:50 pm
More evidence that Orange County’s problems are deeply rooted.
July 20th, 2008 at 4:14 pm
Alf,
It’s PARENTHOOD not PARNETHOOD!! Spell check before ripping someone else..
July 20th, 2008 at 4:16 pm
And Denial is more than a river in Egypt.
July 20th, 2008 at 4:34 pm
wow
You know I come from the midwest, and reading this is a good example of why some may be leaving disillusioned by California. It looks like such a nice place to live from the outside, but trying to understand what is going on on the inside of people who have lived here a while is way over the average human being’s comprehension. As long as you don’t mind not fitting in with the “in crowd” here, it is an OK place to live. I don’t blame this on anyone else except how crazy some of you really are to the us common folk. The violence, gangs, pace, road rage, language, alfalfa??, Chuck Schumer??,
I don’t know Greek.
July 20th, 2008 at 5:03 pm
what I pay for rent
zip code 92805
one bedroom
1970 125 2000 700
1980 400 2008 1200
1990 500
July 20th, 2008 at 5:11 pm
Generally speaking rental markets or vacancy’s are down when home buying is up.
Rental markets are up when home buying is down.
They are generally opposite of each other.
It makes sense if you THINK about it.
It is impossible for there to be so many foreclosures and for it not to influence the rental market (vacancy’s). If OC has a higher than average vacancy rate it is due to a couple of possibilities; 1) People are buying homes (granted at a lower price) or 2) People are moving away from the area and no new people are moving in.
However the location is such that it may only be a very temporary experience. If you had a rental for more than 6 yrs then you should be in good shape! If you purchased your rental in the last 4 or less then you may be feeling the pinch between what is owed and what is received.
I was in the rental business for 6 yrs and thank God I got out of it last yr! Remember the 80’s when this happened before? We made it through back then and we will again! Hang tough, you’re American, it couldn’t be any better!!!
July 20th, 2008 at 5:36 pm
Coming up on 2 years now and NO rent increast at all. Absolutely NONE!
May’be Scott can chime in on how his 7% increase is doing.
July 20th, 2008 at 5:47 pm
this is the result of the government
stickin their big dumb nose into
the free market– instead of skewing
tax incentives into business investment
they skewed them into real estate-
a non productive asset- thanks again
oh real men of stupity- youve again
succeded in ruining a perfectly fine economy
with even more assinine fiscal policy–
enjoy the fruits of your labor– the mother of
all recessions
July 20th, 2008 at 6:32 pm
Well…one thing’s for sure…WAGES need to take a HUGE INCREASE for most here to qualify for a 1 bedroom apartment regardless of the supposed low occpancy rates.
Salaries here in Southern California are still way too cheap due to the huge cheap labor market fueled by certain racial groups who will work for very cheap pricing everyone else out of the job market.
July 20th, 2008 at 7:12 pm
confused………….if people are loosing homes, and they need to live in OC due to work or family or whatever, why is the vacancy going up????
July 20th, 2008 at 7:34 pm
There are 1,500 luxury apartment units coming online in the next four months in Anaheim’s Platinum Triangle. (Plus a few hundred new condos that of course won’t sell.)
Just about a week ago the massive Archstone Gateway project south of Angel Stadium just began leasing the first of its 850 units. Yup, 850 units in one new “upscale” Platinum Triangle complex alone.
July 20th, 2008 at 7:44 pm
There is no question OC apartment vacancies are high nowadays. In the complex I live in (Lake Forest north), there is unusually high number of vacant apartments. This in a nice location and nice, well maintained complex.
In my building, three out of six tenants left in last 3 months because they were not willing pay any increase in rent. I renewed my lease for 6 months last month at the same rent and got $300 off of the first month for renewing the lease.
This should tell you where the OC rental market is right now.
Gary, I had the same question as you had; where all the people went? When I talked to complex manager, he mentioned that due to job losses, a lot of single people are living with a roommate or going back to stay with their parents for now. Recent new arrivals to OC from other parts of country went back to their home towns after job loss.
Also there is increasing supply of condos for rents from individual owners that is putting pressure on the rental market.
July 20th, 2008 at 7:44 pm
Well, what interesting retorts. One reason may be the prospective tenants are worse than leaving it vacant. Scams from real estate agents, wont tell the credit scores or falsifying them. Another is high rents cause many to double up.
What we are seeing is the near and long term rate on CD’s is below the rate of inflation. Who puts money into a CD that loses money every year? We all do. Same for the banks, they are pros and charge 1-2% only to lose 4-32% of your money. Anything less than the DOW average loss is said to be a “gain” We are truly living in bizzaro land
July 20th, 2008 at 8:15 pm
Mary Ellen,
Cheap labor keeps prices down. If people like to live in a country with “free enterprise” and pure capitalism, than you must have cheap labor. Sad to say an economy such as ours needs a lower class to do the work that many dont want to do or at least for what low pay.
If you want to have higher wages, people need to go to school, get advanced degrees or special training.
Im not sure what “racial” groups you mean. People of all races take low paying jobs because they have to.
If you are eluding to illegal imigrants…well as long as companies are out there highering them than there will be people taking those jobs. Additionally, the IRS is loving the unreturned taxes that they have ever year due to the fact that most illegals with fake SS#’s never file tax returns.
The economy is in bad shape. More and more companies will go belly up or lay off people. It is going to get worse before it gets better. Imagine how bad Christmas will be if things stay the same. You think last year was bad, just wait.
July 20th, 2008 at 9:30 pm
This story corroborates population shrinkage stats.
July 20th, 2008 at 9:33 pm
After a quick inflation run up everything gets priced out and the de-flation starts, things correct and we get to start all over.
It’s called a recession.
July 20th, 2008 at 10:20 pm
I think with folks losing their jobs AND their houses forces them to leave the magnificent OC. That’s my take on why vacancies are increasing. This is an expensive place to live after all. Provider keeps telling us all about those 1200 sq ft homes in Irvine renting for $2750 a month (except we’ve yet to be provided with a real live example…no surprise where Provider is concerned).
So if job market is lousy, people can’t live here. And with all those condos coming on the market, who’s going to buy those? So vacancy rate has no where to go but up.
July 20th, 2008 at 11:20 pm
Nice article i am looking for information about PROPERTY FOR SALE can u tell me about it .
Thanks
July 21st, 2008 at 12:04 am
Could it be that the illegal aliens are moving back to their home countries, because there are no more jobs they can steal from Americans?
July 21st, 2008 at 12:23 am
Wow! I don’t know how you Californians afford to live in Cali!
I have a 1000 sq. ft apt - all bills paid - 2 bedroom and 1 1/2 baths with a patio and I pay a whopping $716.00 a month and my rent is well above the median rental here in OKC, OK.
Good luck to you all!
July 21st, 2008 at 1:36 am
Orange County is the most expensive place to rent in the country.
Anaheim’s Platinum Triangle….
It comes with a complimentary artillery barrage every night before bedtime. And fireworks.
July 21st, 2008 at 7:21 am
Hopefully we are seeing some easing due to Illegals self deporting.
Go home and get in the back of the line.
July 21st, 2008 at 7:31 am
When you think about ( for the 20th time) the people on this blog are bit reassuring.
There are what 15 million people in Southern California. There seems to be 1 maybe 2 people who together have 50 aliases who come on here to spread disinformation and cause disruption. Now that is an incredibly small number. In fact there are certainly more cannibals in OC than there are fool bulls who blog here. And I don’t worry about showing a little leg in OC.
The fact that you can get real estate agents to say anything is not new. Only agents with repeat customers will are likely to be honest.
And our blog host who sees no conspiracy amongst “our little cannibal” and his friends must really enjoy Jerry Springer. ( liberal dem)
So except for the “fact” that we have the worst financial crisis since the great depression, it is just another wonderful day in Sourthern California.
If your on the beach use your oil and watch your butt.
July 21st, 2008 at 7:45 am
This is actually a double whammy:
A high number of empty apartments and a high number of empty homes.
A bailout that would prolong putting people into these homes is unsound and frankly, unjust.
It is absolutely undisputable that we have an affordability issue for the first time buyers / young professionals crowd with families.
Companies trying to hire educated professionals from out of state have been saying it for the last four years. Now the numbers simply show it.
It’s a huge tug-of-war between consumer spending (which the Fed wants to see increase), home prices and employment - with inflation in the mix.
Any bailout will do way more harm than good at this point.
Besides - should not RE be able to sustain its own price levels given the fact that job loss or wage reductions was not the instigator?
July 21st, 2008 at 8:08 am
Job losses are high. I dont care how cheap rent is. You still wont be able to afford it if you’re unemployed. The chain reaction / domino effect / house of cards etc. is in full swing.
July 21st, 2008 at 9:09 am
haha finally… just what I’ve been saying
July 21st, 2008 at 9:11 am
Marsha: sounds ilke OCR needs to start a new investigation?
July 21st, 2008 at 2:44 pm
I was looking for a real estate blog and I somehow found the doomsday blog. I’m starting to think there was merit to that mental recession comment.
July 21st, 2008 at 4:04 pm
‘told you so’
July 21st, 2008 at 4:05 pm
So Cal: really, and here I thought some cities were charging extra for this… but yeah, there’s nothing like thin walls to ruin your night’s sleep.
July 21st, 2008 at 5:32 pm
That means 1 out of 17 apartments are empty.
July 21st, 2008 at 10:27 pm
# tominyl Says:
July 20th, 2008 at 7:44 pm
“What we are seeing is the near and long term rate on CD’s is below the rate of inflation. Who puts money into a CD that loses money every year? We all do. Same for the banks, they are pros and charge 1-2% only to lose 4-32% of your money. Anything less than the DOW average loss is said to be a “gain” We are truly living in bizzaro land”
i have CD’s (under $100,000 of course). where else are you going to put your money? stock market, hell no. bear market unless you going to short. i have a few shorts. invest in Auction Rate Securities where investors can’t even pull they money out because no one wants to buy that junk? i already have some investments in gold and oil to hedge against inflation and the dropping dollar. where else is a good investment. not much, but at least i know i wont be losing double digit losses. It sure is bizzaro land.