Los Angeles, Orange County rent hikes at 5-year low, CPI shows - OCRegister

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The pandemic-weakened economy has cooled rent hikes in Los Angeles and Orange counties to the slowest pace in five years, the local Consumer Price Index shows.

The U.S. Bureau of Labor Statistics found rent inflation at a 3.6% annual rate in July vs. 5.8% a year earlier. The last time local rent inflation was this low was July 2015.

The CPI tracks rental costs by polling consumers about rent they pay compared to other measurements that come from surveys of landlords. Those indexes show local landlords offer new tenants essentially the same rents as they did a year ago, the first time “asking” rents have failed to rise in a decade.

No matter the math, rent hikes have decidedly cooled as landlords deal with a coronavirus-chilled economy, tenants unable to pay rents, and competition from a growing supply of empty apartments, both existing and newly constructed. The L.A.-O.C. CPI rent index’s latest reading is down from a 5.5% average for all of 2019 and 4.6% in 2015-2018.

Inflation is down across the board as the local economy is throttled by “stay at home” orders aimed at slowing the spread of coronavirus. L.A.-O.C.’s overall cost of living was rising at a 1.9% annual pace in July vs. averaging 3.1% in 2019 and 2.3% in 2015-2018.

Other July inflation trends you should be watching …

• The big picture: The local 1.9% overall rate compares to the nation’s 1% while CPI in Western states rose at a 1.7% pace.

• Shelter’s burden: Housing eats up the biggest share of local household budgets. Minus shelter costs, the LA-OC CPI’s up only 1% in 12 months.

• Fuel: Gasoline in L.A.-O.C. cost 16.6% less in the last 12 months, by CPI math. Household energy cost 6.3% more.

• Food: Groceries rose 3.5% while eating out got 5.7% pricier.

• Medical: Bills were 5.1% costlier.

• All local services: 3% pricier.

• Apparel: Clothing was 0.4% cheaper.

• Big-ticket items: The cost of “durable goods” (such as appliances and furniture) was 2.8% lower.

• To the east: Overall Inland Empire inflation was 1.7% shown by the latest bimonthly index for Riverside and San Bernardino counties.

• Size matters: Big cities in Western states saw consumer prices last month up at a 1.9% annual pace. Smaller Western cities? 1.5% inflation rate.

• Elsewhere in the West: San Diego CPI? Up 2.1% annually vs. 1.3% for Urban Hawaii.

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August 19, 2020 at 01:34AM
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Los Angeles, Orange County rent hikes at 5-year low, CPI shows - OCRegister
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