RENT GROWTH SLOWER THAN IN REST OF COUNTY.

Byline: Staff and Wire Services

Rental rates increased in recent years in Santa Clarita, but not at the same rate as in the rest of Los Angeles County - in part because of the hot housing market, according to studies.

Rents increased 2.2 percent from the third quarter of 2003 to the same period last year, while the rest of the region saw average rent increases ranging from 3 1/2 percent to almost 6 percent the past year this year, according to the Casden Real Estate Economics Forecast released this week by the University of Southern California Lusk Center for Real Estate.

The Casden Forecast indicated renters are being drawn to Santa Clarita attracted to upscale lower-cost units within commuting distance of Burbank and the San Fernando Valley.

The average monthly apartment rent in Santa Clarita was $1,372 in 2004, a 2.2 percent increase over the previous year. The average one-bedroom, one-bathroom apartment rented for $1,151 last year; rent for a two-bedroom, two-bath apartment was $1,450 a month, according to an survey by RealFacts of Marin County, which surveyed six large apartment complexes - a total of 1,559 units - in Santa Clarita.

Still, rental rates increased in Santa Clarita at a lower rate than in the rest of the county. The market is weaker in part because of new condominium developments that drew buyers seeking tax advantages and low-interest mortgages, according to a survey by Mark Schneipp, director of the California Economic Forecast, based in Santa Barbara County.

The Casden survey predicts asking rents and occupancy rates in Southern California's multifamily markets will continue to rise.

``The new supply of apartments has not kept up with demand from newcomers attracted to jobs in our diverse economy and the Southern California lifestyle,'' said Delores Conway, director of the Casden forecast.

Apartment occupancies are at all-time highs in Los Angeles, Orange, Riverside and San Bernardino counties because of a steady stream of young professionals and Latin and Asian immigrants who cannot afford the average home, as well as relocated executives who choose not to get locked into a mortgage.

In Santa Clarita, vacancy rates have remained low, about 4.4 percent in the past year.

Conway pointed out that Southern California's steadily growing and diversified economy sets the stage for increased job formation and more demand for apartments in the coming year.

For 2005, the average rental rate for a two-bedroom apartment should rise to approximately $1,500 in Los Angeles County, $1,520 in Orange County and $1,080 in the Inland Empire, according to data compiled for the Casden Forecast. The forecast analyzes apartment transactions, new building permits, leasing activity and employment data to produce forecasts of rent and vacancy levels in Los Angeles County, Orange County and the Inland Empire. The analysis incorporates unit-level data purchased from M/PF YieldStar Inc. with county economic data.

The average rent for a two-bedroom unit is the highest in West Los Angeles at $2,319, nearly double the price for the same unit in the Antelope Valley. For the rest of 2005, rents should increase almost 4 percent to an average of approximately $1,200 for a one-bedroom, $1,500 for a two-bedroom and $1,700 for a three-bedroom unit. Occupancy rates will remain tight as job growth picks up throughout the county.