The cost of renting in Southern California looks like it’s settling in to grow in the mid-4% range, with the annual increase in October at 4.4%, the same as September, according to the government’s latest Consumer Price Index.
| 2007 | 2008 | |
|---|---|---|
| Jan. | 6.2% | 5.9% |
| Feb. | 6.7% | 5.3% |
| March | 6.9% | 4.4% |
| April | 6.4% | 4.2% |
| May | 6.1% | 4.3% |
| June | 5.9% | 4.5% |
| July | 5.8% | 4.7% |
| Aug. | 6.0% | 4.2% |
| Sept. | 5.9% | 4.4% |
| Oct. | 6.0% | 4.4% |
| Nov. | 6.0% | |
| Dec. | 6.1% | |
| Avg. | 6.1% | 4.6% |
The Orange County-LA-Riverside area hasn’t seen rent costs rising that little in eight years. In 2000, rental costs were going up an average 4.1%. Last year, they were increasing at a 6.1% annual pace.
The government’s version of home costs, which it computes based on what it would cost to rent your home (as opposed to the sales value), was up 3.7% in the 12 months ended in October. That’s an eight-year low. Last year, home costs were rising 5.1%.
But housing costs are still having an impact on the consumer’s pocketbook. Richard J. Holden, regional commissioner for the Bureau of Labor Statistics, cited rising prices for housing as the biggest contributor to the 3.4% increase in overall SoCal consumer prices in the last 12 months. Housing costs have a greater impact because they make up 46% of all items in the SoCal CPI.
Other CPI news on the housing front in October was mixed:
- Housing costs overall rose at a 3.2% annual pace, up from 2.8% in September, but down from 4.3% in October a year ago.
- Natural gas costs are down dramatically — -9.5% in October compared to a 19.2% hike this time last year. (For more good news on So Cal gas prices this winter, CLICK HERE.)
- Electricity costs rose at a 3.2% annual rate after declining for six months. Last year, electricity rates dropped 10.5% in October.
- The decline in home furnishings may have hit bottom. October costs were up 0.6% annually following a 0.3% rise in September and breaking a 17-month string of lower costs.
For more on the overall CPI, CLICK HERE.
Read the full SoCal press release HERE!
Did you miss these other stories on the economy …
I think the Government better check their math, it s/b -4.4% not +4.4%. I was looking at rentals in Newport and they don’t look like they are going up.
just more B.S. from the B.L.S.— hey blogger hows about
a 41% decline in prices for homes in so cal? thats
forty one percent — holy deflation batman
http://www.latimes.com/business/la-fi-homes19-2008nov19,0,5649769.story?ref=patrick.net
the price of everything will be going down…… the funny thing we are finding out now in this mess……. is that housing prices didn’t even have to go down……. all they had to do was stay flat for a few years and we would be in economic armageddon….. because the entire economy was leveraged on the basis of house prices going up……. house prices didn’t have to even fall to knock down the house of cards…. all they had to do was stay flat for a couple years (admittedly I am understanding and confirming this now in hind sight)…….all my decisions were based on the house of cards falling apart based on home price declines, and all I need were prices to stay flat… lllooolll, now that is pretty funny…. now the deflationary death spiral will bring the cost of EVERYTHING down….
Rents in Newport have been coming down big time. With the economy collapsing around us, this was to be expected.
paying 4.4% more for rent is still much better than losing 30% of equity in our homes like most of us homeowners had to suffer.
more “bailouts” please….. they only seem to accelerate deflation… sending cash to insolvent companies and indiviuals who keep digging their insolvency hole deeper…..
there is no liquidity problem…… you can sell a house or any asset today at the right price….. problem is the debt is greater than the liquid price…. that’s insolvency… not liquidity…. and its only getting worse in the deflationary death sprial…
oh, by the way
those of you who bought more house than you can afford let me remind you that 12/10/2008 is the deadline for paying your first installment of the property taxes.
Good luck coming up with the money for that.
I guess you’ll have to skip the vacation this year :-)
NOT ONLY I HAVE TO SKIP THE VACATION, I HAVE TO SKIP SEVERAL PROSTITUTE VISITS AS WELL.
Damn Honky,
That will only trigger more layoffs in the escort sector as well - and that may trickle over to the Westminster Massage Parlors.
Is there no sector that will be spared!!!
mav-
Will things be getting cheaper in Westminster as well?
I don’t believe that landlords have the pricing power to increase rents at all, yet the Gov’t wants us to believe rents are increasing 4.4%.
Sure they are.
“NationalBubble.com Says:
November 19th, 2008 at 1:31 pm
oh, by the way
those of you who bought more house than you can afford let me remind you that 12/10/2008 is the deadline for paying your first installment of the property taxes.
Good luck coming up with the money for that.
I guess you’ll have to skip the vacation this year”
Cheering and laughing at people who can’t pay their taxes. Your a real stand up guy Bubble.
Liar Loan Says:
November 19th, 2008 at 3:48 pm
mav-
Will things be getting cheaper in Westminster as well?
LL,
I don’t know Westminster very well, other than it’s generally a middle class to lower middle class area.
My anticipation would be that median family income in Westminster for 2009 would be somewhere around $60,000. (it could be less if unemployment gets really bad, greater than 10%)
My guess is there are some nicer areas of Westminster, but in general I would give you a projection of low $200,000s for the median of Westminster in the trough…..
LL, you may have been talking about the Westminster mall…. if so sorry for the confusion……. most definitely YES things will be getting cheaper…. retailers will need to provide huge discounts and unfortunately many retailers will be going out of business as the credit valve gets shut off and amercians start to save money over the next several years…. when people realize the impact of deflation they will start saving….
I was referring more to the massage parlors in Little Saigon, in reference to SavingLA’s comment.
i live in a big apartment complex in westminster that has a 25% vacancy rate. if they try to raise my rent, i’ll just go across the street where it’s cheaper.
Up 4.4%, and that’s the lowest increase in years? Wow, renting sure is great. If that is roughly the local inflation rate (and it probably is, ballpark), then my mortgage loan balance has been reduced a nice chunk in real dollars. My property taxes due? No joke, Sherlock. They’re paid for by my mortgage interest deduction. In full.
Also, just ordered numerous fruit trees for a special yard area. Home gardening is one of those special pleasures for home OWNERS. Oh, does my property appraise for less than a year ago? Boo hoo, anybody remember the mid-90’s? Same thing, same eventual result. If you can afford the payments, you’ll win in the end. Snarl away, uber-bears.
Raisining rents we will go……..
Raising rents we will go…..
Hi Ho a Marry o Raising LA/OC rents we will go………