L.A. Rents PLUNGE to 4-Year Low

Los Angeles renters finally catch a break as median rents plunge to a four-year low of $2,167, proving free-market supply surges deliver real relief after years of Biden-era inflation and regulatory chokeholds crushed affordability.

Story Snapshot

L.A. metro median rent drops to $2,167 in December 2025, lowest since 2021, amid 5.3% vacancy rates.
Record multifamily supply overwhelms demand, aided by L.A. County’s 28,000-person population decline in 2025.
National apartment completions topped 500,000 units in 2024-2025, shifting power to tenants in Sun Belt metros.
Experts forecast 2026 recovery with slowing construction and 2% rent growth, stabilizing the market.

Supply Surge Creates Renter’s Market in L.A.

Los Angeles metro area median rent fell to $2,167 in December 2025, marking a four-year low. Vacancy rates climbed to 5.3%, the highest since April 2021. A surge in multifamily housing supply outpaced weakened demand, creating a true renter’s market. New units reduced competition for older stock, easing pressures on working families long squeezed by high costs. Coastline Equity CEO Anthony Luna noted this supply addition lowers demand for legacy properties. Population decline in L.A. County by 28,000 during 2025 amplified the shift.

National Apartment Boom Roots in Post-Pandemic Buildup

U.S. apartment completions exceeded 500,000 units annually in 2024 and 2025, record highs driven by early low interest rates and household formation demand. Rents flatlined nationally for two to three years as supply caught up, pushing affordability to its healthiest levels in six years by late 2025. Wage growth outpaced rents for the third straight year, bolstering household budgets. High mortgage rates kept buyers renting, but deliveries overwhelmed absorption in Sun Belt areas like L.A. Construction slowdowns began late 2025, signaling the wave’s end.

Sun Belt Pressures Contrast Regional Divides

Sun Belt metros, including L.A., faced rent pressure with negative or near-zero growth and occupancy at 92-94%. Northeast and Midwest markets thrived due to supply constraints and stronger job growth. National occupancy eased to 92-95% in Q3 2025 amid supply peaks. Net absorption moderated mid-2025 after strong showings of 337,400 units in the first nine months per CBRE and 463,000 over 12 months per CoStar. L.A.’s unique four-year rent bottom stems from acute supply and population stagnation.

Stakeholders like developers and REITs manage lease-up pressures in Class A properties while eyeing stabilization. Data firms such as CBRE, CoStar, and NAA shape investor outlooks with granular metrics.

Experts Predict Market Recovery Ahead

Early 2026 analyses show supply completions peaking while starts slow, maintaining renter leverage in L.A. National rents rose 2.9% year-over-year in December 2025 but remained flat overall from 2024-2025. NAA VP George Ratiu forecasts a 2026 transition with 2% national rent growth as the supply wave ends. Absorption projections stand at 350,000-400,000 units, down from 2025 highs, with Sun Belt recovery underway. RealPage highlights wage gains supporting demand and fewer moves to homeownership deepening the renter pool.

Short-term relief aids tenants with lower rent burdens nearing 2018 lows relative to income. Long-term, supply taper restores 2-5% growth by 2026-2027. This supports household formation, reduces doubling-up, and eases mobility in oversupplied areas. Politically, it undercuts housing crisis narratives in states like California, validating market-driven solutions over government overreach.