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Sharp Increase Recorded in L.A. MF Transaction Volume
Los Angeles emerged as the third most active multifamily investment market in the U.S., behind New York and Dallas in 2018. According to research by JLL, transaction volume increased from $5.5 billion in 2017 to more than $7.5 billion in 2018, representing a 36.3% jump. As a result, L.A. grew from the sixth to the third largest multifamily investment market in the country.
Investors’ heightened focus on Los Angeles is supported by strong market fundamentals. Median home prices have increased 40% over the last five years, pricing out many home buyers and creating more renters. Multifamily occupancy is currently near peak levels in the current cycle at 96.5%.
Unlike other U.S. markets, L.A.’s new supply poses less of a risk. Most of the region’s submarkets continue to be undersupplied. Coupled with already low vacancy, a thinning development pipeline and potential increases in interest rates, which could create additional barriers to home ownership, JLL expects the Los Angeles multifamily market to remain strong and garner additional investor interest.
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- ◦Sale/Acquisition
