Low rents hard to find
It may be a renter’s market in Santa Monica, but the cost of living here continues to climb.
Officials estimate that a person must make $60,000 a year just to afford a one-bedroom apartment in Santa Monica.
A recently released report from the city’s rent control board shows that in the four years since vacancy decontrol went into effect on rent-controlled apartments, 9,486 units have been increased to market rates. As a result, 35 percent of rent-controlled apartments in the city have been raised to market levels.
The median rent for a studio apartment increased from $612 to $896 over the same four years, one-bedroom units have gone up from $695 to $1,195 and two-bedroom apartments have climbed from $889 to $1,606, on average. Three-bedroom apartments have increased from $1,131 to $2,074, according to the report.
Monthly rents for some apartments have increased even more. A two-bedroom, two-bathroom rental located blocks from the beach or off of Main Street can be as much as $3,000 a month, observers say.
Rentals were up 5.7 percent in Los Angeles County last year, said realtor Jodi Summers of Santa Monica-based Boardwalk Realty.
“Anyone who is going to live in Santa Monica will pay whatever the market rate is,” she said. “Now, it’s a rich man’s market.”
However, renters may be in a better position these days to shop around and negotiate rental prices with landlords. Many rentals throughout the city are staying vacant longer than they did previously.
“Properties are sitting on the market for months because people don’t want to pay the high rents,” Summers said. “But a lot of landlords, especially ones who renovate their properties, are being wise in finding the right tenant.”
“Properties are sitting on the market for months because people don’t want to pay the high rents.” — — JODI SUMMERS Boardwalk Realty agent
Depending on the number of bedrooms in a unit, the household income needed to afford the median market rent in Santa Monica at 30 percent of gross income ranges from $51,200 to $76,461, representing an increase of between $16,200 and $34,700 over the past four years.
365,HUD affordability standards assume 30 percent of a household’s gross income may be used for rent before the household becomes “rent burdened.” The maximum income levels for a four-person household consider $27,550 to $33,060 a year as very low; $44,100 as low and between $55,100 and $66,100 as moderate.
Based on HUD’s 30 percent affordability standard, a person needs to make $51,200 a year to afford a studio apartment in Santa Monica and $59,750 to afford a one-bedroom unit.
The report concludes that units have been lost at every affordability level and every bedroom size as a result of market rent increases since 1999.
“The bottom line is that there is a significant loss of controlled units,” said Tracy Condon, a spokeswoman for the city’s rent control board. “Before, there were 1,900 units that were considered low-income rentals. Now, there are 67 left.”
Before the increases, 79 percent of the units had rent levels affordable to low-income households. After the increases, just 11 percent remain affordable at the low-income level.
More than 6,500 of the units that had been affordable to low-income households are no longer affordable. Included in that, 3,950 units are no longer affordable to very low-income households, according to the report.
Despite the loss of affordable units in Santa Monica, there are still 18,000 rent-controlled units in the city. The largest portion of rent-controlled units are in the north of Wilshire Boulevard neighborhood, representing 22 percent of all affordable units. The second highest neighborhood with rent-controlled apartments is between Wilshire and Colorado boulevards, east of Lincoln Boulevard, with 19 percent of the inventory. Third is the Ocean Park neighborhood, with 17 percent of rent-controlled units and 17 percent of the overall stock of rentals.
The most expensive neighborhood to live in continues to be north of Montana Avenue, which has 16 percent of all rent-controlled apartments in the city, Condon said.
Last year, 1,729 apartments were brought to market rates, which is slightly less than the previous three years, Condon said. During the first year of decontrol, 3,192 units were impacted.
“It what we expected, we haven’t been surprised at the these numbers,” she said. “We actually anticipated a much larger turnover when the law was put into effect.”
Originally published in the Santa Monica Daily Press print edition on April 29, 2003. Read the original PDF.