High demand for apartments continues to have a steady rise in Orange County, CA where high construction costs and cascading land values maintain the Orange County housing market as one of the most expensive in the country.
Following this year’s up poar in construction, occupancy has remained compact, specifying rapid swift absorption of new deliveries, while rent growth dropped to 2.6 percent as of October 2017.
The multifamily market got an increase in growth from high-paying jobs in areas that attract the region’s more educated workforce, such as:
- Health care
- And higher education
Regardless of the slowdown, the labor market continues to expand, led by steady growth in construction.
A mixed-use project worth mentioning, LT Global Investments’ $450 million LT Platinum Center in the fast-growing Platinum Triangle, is slated to encompass office, retail, hotel space, apartments, condominiums and a movie theater.
Large office developments include the 1.1 million-square-foot Five Point Gateway and the 38-acre Flight at Tustin Legacy.
Rising market pressures forecast an affordable housing shortage. For investors looking for value-add opportunities, apartments/multi family units have become hot commodities, but, as rents go up following renovations, low-income residents are being displaced by a higher-earning cohort.
While legislation keeps property taxes low for existing owners, it does not keep rates from reaching current market levels once a property changes hands, further contributing to rent hikes.
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