Real Estate newsletter: Renting becomes a competitive sport
Welcome back to the Real Estate newsletter. This week, we’re focusing on the brutal, broken state of the Southern California rental market.
More than half of L.A. County residents are renters — one of the highest rates in the country — so it only felt right to look into why exactly finding a place to stay here is so difficult.
First, we spoke to renters, landlords and experts and found that the rental market is looking more and more like the housing market, which sees potential homebuyers enter bidding wars and push up the sale price by hundreds of thousands of dollars, sometimes more. Well, the same appears to be happening for renters, as potential tenants have started offering more than the monthly rent in order to land the perfect spot.
The driving force behind the trend? A vacancy rate of just 3.5%, which is the lowest in more than two decades.
We also took a peek at the myriad COVID-related eviction bans, some of which are expiring and some of which remain. During the pandemic, it seemed like a new protection for renters was adopted every month, so we checked in on which ones are still standing.
For example, the city of L.A. continues to ban evictions for not paying rent for anyone who has suffered financial hardship due to COVID-19. However, even though your landlord might not be able to evict you, the landlord can still sue you for unpaid rent.
The week also saw a brush fire in the hills below Griffith Observatory, which served as a vivid reminder that fire season is officially upon us. With that in mind, The Times looked into the vacation rental market and found that thousands of California Airbnbs operate in fire-prone areas. To help, we put together a guide on the risks of renting in fire hazard zones.
On the celebrity side, one seller made a quick flip and another listed a longtime home.
The quick flipper, perhaps not surprisingly, was Ellen DeGeneres, who sold a Beverly Crest mansion for $8.757 million less than a year after buying it. It was far from a success, however, as the sale price is just $257,000 more than she paid for it. Between taxes and agent fees, DeGeneres surely took a loss.
The other seller is Engelbert Humperdinck, the British pop singer whose international real estate portfolio includes homes in England, Mexico and Hawaii. He’s owned a scenic mansion on a ridge in Bel-Air since 2005, and he’s asking $6.2 million for the property.
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The rental market is brutal
Bidding wars for houses are a common ordeal in Southern California, a sort of painful induction process that spits out a now-decreasing number of victors into the ranks of homeowners.
The availability of apartments in Los Angeles and surrounding counties is so tight that some renters are paying above list price to secure a high-quality unit, while others jostle for the remaining stock of apartments.
“Everyone is just battling for the same places,” said Anna Maciaszek, who moved to Los Angeles in January and has been living in short-term rentals as she looks for a permanent apartment.
The number of apartments available for rent in L.A. County is the lowest it’s been in two decades, while listings in the Inland Empire and Orange County are below or near records set before the COVID-19 pandemic.
In L.A. County, rent is up 16% from a year ago, and landlords have a strong hand in setting terms and prices.
What protections do renters still have?
Rental housing in Southern California has long been a landlord’s market, with the demand for homes greatly exceeding the supply. That’s true today to an extreme degree, with available units the scarcest they’ve been in recent memory, writes Jon Healey.
The state sought to make renters and landlords whole by using federal aid to pay the rent debt accrued by tenants hurt by the pandemic. But the payments have been held up by months-long backlogs.
Some of the state restrictions on landlords have now expired, leaving eviction bans and rent deferrals in place only in Los Angeles and other select cities. The result is a patchwork of rules that vary according to where you live, when you started renting your unit and when you missed your rent payments.
To help you navigate this landscape, here are answers to a few of the big questions tenants and landlords face today in Southern California.
Is your vacation rental safe from fires?
Planning an idyllic vacation with your friends might include booking a vacation rental on a Malibu hillside with ocean views or surrounded by pines in Lake Tahoe, writes Karen Garcia.
A Los Angeles Times analysis found that thousands of Airbnb rentals in California operate in areas with high levels of wildfire hazard, so it’s worth researching where your rental is located, where fires happen and where to receive evacuation notices.
Here’s how you can research the potential for disaster and what to do if it strikes next time you’re staying in a vacation rental.
Ellen flips a stylish Midcentury
Less than a year after buying a Midcentury home in Beverly Crest for $8.5 million, prolific house-flippers Ellen DeGeneres and Portia de Rossi have sold the place in an off-market deal for $8.757 million.
The $257,000 profit margin is a bit slimmer than their usual projects. They made $6.3 million flipping a Montecito compound for $33.3 million in 2020, and last year, they earned a quick $4.5 million by selling a Beverly Hills mansion for $47 million.
Tucked away in Hidden Valley Estates, the Midcentury gem has been tied to some notable names over the years. It was built in 1961 by L.A. architect Robert Skinner, and the chic post-and-beam design was later featured in Julius Schulman’s book “Modernism Rediscovered.” In 2021, DeGeneres and De Rossi bought it from talent agent Greg Cavic.
British pop singer lists Bel-Air home
Engelbert Humperdinck, the British pop singer who’s been releasing music since the 1960s, is shopping around his Mediterranean-style mansion in the hills of Bel-Air for $6.2 million.
He’ll double his money if he gets his price. Records show he paid $3 million for the property in 2005.
Perched on a promontory overlooking Stone Canyon Reservoir, the 1980s haunt is just one piece of Humperdinck’s international real estate portfolio. Over the years, he’s owned homes in England, Mexico and Hawaii; in the 1970s, he bought the Pink Palace, a bright pink-colored estate once owned by late movie star Jayne Mansfield in Holmby Hills.
His latest listing is being marketed as a tear-down or fixer-upper, since the four-story residence is stylistically showing its age. Orange walls fill the living spaces, and the kitchen is covered in stained glass.
What we’re reading
Mansions in this newsletter are typically photogenic — glitzy and glamorous in hopes of luring in a deep-pocketed buyer. But what happens when one falls into disrepair? This week, New York Post provided a tour of Diddy’s 20,000-square-foot abandoned mansion in Georgia, which was left halfway through a renovation and features graffiti-covered walls, an unfinished staircase and moldy swimming pool.
Take a look at this tiny-home community tucked away in Mount Laguna, a remote mountain community in San Diego County. One couple gave a tour of their 250-square-foot spot and the 25-home interdependent community surrounding it, which boasts its own internal economy and a recently built dog park. Insider has the story.
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