Contrast that with the city of Los Angeles, where building apartments has become too costly, and potential profits are unstable. That\u2019s what my colleague Roger Vincent<\/a> documented last week<\/a>.<\/p>\n If your search for a new place in L.A. has seemed overly difficult, here\u2019s why.<\/p>\n You’re reading the Essential California newsletter <\/p>\n Our reporters guide you through the most important news, features and recommendations of the day.<\/p>\n By continuing, you agree to our Terms of Service<\/a> and our Privacy Policy<\/a>. <\/p>\n What\u2019s happening with new apartment builds?<\/p>\n The supply of fresh rental units, which make up the bulk of new housing in Los Angeles, is petering out despite robust demand. The vacancy rate is among the lowest in the country, while rental rates are among the highest.<\/p>\n Still, the number of new units under construction in Los Angeles has been falling each quarter since early last year and is set to dive to a 10-year low, according to real estate data provider CoStar.<\/p>\n Fewer than 19,000 apartments were under construction in the three months through September. That\u2019s 30% fewer than three years earlier, according to CoStar\u2019s count.<\/p>\n Less profits equals less building<\/p>\n Ari Kahan, a principal of California Landmark Group. used to have multiple projects with as many as 800 total units being built in Los Angeles at any given time. No more, he said.<\/p>\n \u201cWe haven\u2019t bought a site with the intention to develop it in over two years,\u201d he said. \u201cI don\u2019t know when we will be building in L.A. next.\u201d<\/p>\n Developers say they can\u2019t raise the money to build because many of their biggest backers \u2014 pension funds, insurance companies and other institutions looking for long-term investments \u2014 don\u2019t want to park their money in L.A. because the rapidly changing rules make it impossible to predict profits.<\/p>\n \u201cL.A. has been redlined by the majority of the investment community,\u201d said Kahan.<\/p>\n Federal policy adds to the headache<\/p>\n Higher tariffs have sparked rising prices in construction materials and equipment, while the crackdown on undocumented workers has thinned and spooked much of the international workforce the industry depends on.<\/p>\n \u201cPrices rose at an especially rapid pace in some of the categories most affected by tariffs,\u201d including iron and steel prices, which have risen 9% in the last year, and copper wire and cable prices, which have jumped 14%, said Anirban Basu, chief economist of trade group Associated Builders and Contractors.<\/p>\n California\u2019s construction industry depends on immigrant workers<\/a>. Around 61% of construction workers in the state are immigrants. Of that group, 26% of those are undocumented, according to a June report<\/a> from the Bay Area Council Economic Institute.<\/p>\n What do the numbers say?<\/p>\n Housing production in Los Angeles County has slowed dramatically over the decades, dropping from more than 70,000 new units annually in the 1950s to roughly 30,000 in the 1970s and 1980s to fewer than 15,000 in the 2010s.<\/p>\n This long-term slowdown in housing construction has left the region with an older, more strained housing stock and a deep shortfall in affordable options.<\/p>\n That\u2019s according to findings from a new USC project that collects housing data on Los Angeles County neighborhoods<\/a>.<\/p>\n Solutions can be found\u2026outside of L.A.<\/p>\n The cost of building new apartments in Los Angeles is also hard on renters.<\/p>\n At the current construction price, developers need to charge between $4,000 and $5,000 per month in rent, depending on the apartment size, making affordability an issue. Rentcafe suggests a renter will need to make about $13,400 in gross monthly income<\/a> to afford $4,000 in monthly rent. <\/p>\n Developers predict people will have to move farther out and commute times will grow.<\/p>\n For more, check out the full article here<\/a>.<\/p>\n The week\u2019s biggest stories (Jane Rosenberg \/ Associated Press)<\/p>\n Crime, courts and policingTrump policies and reactionsEntertainment newsMore big storiesThis week\u2019s must-readsMore great readsFor your weekend (Illustrations by Lindsey Made This; photograph by Bobbi Rich)<\/p>\n Going outStaying inL.A. Affairs<\/p>\n Get wrapped up in tantalizing stories about dating, relationships and marriage.<\/p>\n Have a great weekend, from the Essential California team<\/p>\n Jim Rainey, staff writer How can we make this newsletter more useful? Send comments to essentialcalifornia@latimes.com<\/a>. Check our top stories<\/a>, topics<\/a> and the latest articles<\/a> on latimes.com<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"Drive around Riverside County and signs for new apartment complexes are all over the 60, 15 and 215…\n","protected":false},"author":3,"featured_media":279895,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[5123],"tags":[7830,7828,1582,276,7832,7824,7823,4140,6123,6772,7826,2961,224,2444,5337,2295,7825,5812,7829,7831,2501,527,7827],"class_list":{"0":"post-279894","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-los-angeles","8":"tag-autopilot","9":"tag-black-bears","10":"tag-ca","11":"tag-california","12":"tag-convictions","13":"tag-coronavirus","14":"tag-covid","15":"tag-covid-19","16":"tag-driver","17":"tag-drought","18":"tag-essential-california-week","19":"tag-la","20":"tag-los-angeles","21":"tag-los-angeles-times","22":"tag-losangeles","23":"tag-newsletter","24":"tag-pandemic","25":"tag-search","26":"tag-tesla","27":"tag-thousands","28":"tag-ucla","29":"tag-water","30":"tag-years"},"share_on_mastodon":{"url":"https:\/\/pubeurope.com\/@us\/115322566489858046","error":""},"_links":{"self":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/279894","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/users\/3"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/comments?post=279894"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/posts\/279894\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media\/279895"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/media?parent=279894"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/categories?post=279894"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/us\/wp-json\/wp\/v2\/tags?post=279894"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}} <\/a> <\/p>\n
<\/a> <\/p>\n
Andrew J. Campa, reporter
Kevinisha Walker, multiplatform editor
Karim Doumar, head of newsletters
Diamy Wang, homepage intern
Izzy Nunes, audience intern<\/p>\n