Los Angeles Multifamily Renovation Vacancy

Tips For Leasing Your Vacant Apartment Unit During Covid-19

Apartment vacancy is high in Los Angeles right now as a result of the effects of Covid-19.  As a result many landlords are left with vacant units that are collecting dust due to current residents moving out for various reasons which include things like exiting Los Angeles entirely, consolidating from say a 2BR unit to a 1BR unit to save money or even moving back in with their parents.

18 months ago if you had a vacancy in a prime area, you might only have had to put out a ‘For Rent’ sign and you would have applications in within a few days.  Times have changed during the global pandemic and in order to lease your vacancy, you may have to do some things that you otherwise would not have had to do.

Here are a few tips for leasing your vacant apartment unit during a period of high vacancy such as this one:

Freshen Up Your Unit – Keep in mind that you are competing with nicer buildings who also have vacancies and whose rents are likely falling as a result. Your product has to look good. I’m not saying that you need to fully renovate your vacancy but there are various low cost improvements you can make to make it look a little bit fresher such as painting the unit, putting in new blinds, reglazing the bathtub and changing out old light fixtures, kitchen and/or bathroom fixtures. These minor improvements can make a difference in terms of attracting prospects.

Take Good Photos – I can’t tell you how sad it is to search to find tired looking units with even worse photos. The first thing the average millennial renter will do when searching for an apartment is go online and search listings. If your unit does not show well on screen, you will likely not get inquiries. You do not have to hire a professional photographer for every vacancy. The new iphones have excellent wide-angle lenses which will do just fine in terms of capturing what you need to capture.

Utilize All Online Listing Platforms Available to You – Although putting up a For-Rent sign may have been your only source of leads in the past, if you are not using online listing sites like, Zillow, or even Craigslist, you will not get the volume of inquiries you are looking for.

Answer The Phone and Respond to Inquiries Promptly – This should go without saying but I speak to many rental prospects on the phone who are so happy to get a warm body who actually answers the call and responds to their inquiries quickly. A lot of times with renters, the first person they can get on the phone is the first place they will tour and often times the place they will lease. You should create a template response that goes out to all text and email leads which you can just copy and paste to each prospect without having to write a new one every time!

Be Realistic With Pricing and Even Offer a Concession – Let’s face it, with high vacancy comes the flattening and even decline of apartment rental rates. In some major metropolitan areas, some large apartment landlords are reporting rents being down as much as 20%. Price your unit accordingly and if you are offering say a one month concession, try to negotiate a 13-month lease.

Los Angeles Multifamily Vacancy

Apartment Vacancy Continues to Rise in Major Metropolitan Areas

If you own a multifamily property in Los Angeles, chances are that in the last 12 months (during the global pandemic), you have dealt with some component of vacancy at your property.  We expect this trend to continue at least through 2021.   

Here is why:

Why vacancy rates are expected to rise in 2021:

1. New Supply Being Delivered to Market:  More than 396,000 apartment units were delivered in 2020, a peak year for deliveries, according to Dodge Data & Analytics Supply Track. Another 506,637 are anticipated to be delivered in 2021. However, it is possible given labor and material shortages that not all of those apartments will be completed this year. The cities with the highest levels of apartment construction underway now include New York, Washington, Dallas, Houston, Los Angeles and Seattle, according to Dodge.

2. Demand is Down:  Demand, particularly for Class A apartments in prime urban locations, dropped precipitously early in the pandemic as young adults left to move in with their parents and tenants moved to the suburbs in search of more living space, less density and lower rent. Working remotely and the lack of availability of urban amenities during the pandemic meant renters were more likely to move away from expensive downtown locations. Those renters are not anticipated to return to their offices – at least not full-time – until later in 2021 or perhaps 2022.

3. Disconnect Between Demand and Supply:  While demand is expected to remain strong for Class B and Class C apartments, especially in markets with relatively steady employment, new supply is primarily Class A apartments in already saturated markets where demand is down.

4. Uneven Performance by Market: Vacancy rates also vary by market. Class A apartments in prime urban markets, particularly in gateway cities, are not expected to recover until 2022, according to market analysis by CBRE. But markets in the Midwest and South, which didn’t deteriorate as much in 2020, are anticipated to have lower vacancy rates in 2021.

5. Job Growth Won’t Replace 2020 Job Losses:  Fannie Mae’s economic forecast expects job growth of 5.5% by the end of 2021, but even that estimated 7.9 million new jobs won’t make up for the estimated 9.3 million jobs lost in 2020. Fannie Mae expects it will be 2022 before those jobs are replaced and before demand will increase substantially for apartments.

Why vacancy rates will improve in 2022

The U.S. economy will begin rebounding in 2021, particularly as vaccinations become more widespread. That rebound is anticipated to accelerate in 2022. By late 2021 and into 2022, job growth is anticipated by Moody’s Analytics to increase in Austin, Dallas and Phoenix, which should increase multifamily demand. All three cities have a significant amount of supply, but demand is strong enough to absorb that supply. Other cities where employment recovery levels by the fourth quarter of 2021 are expected to be strong include Salt Lake City, Indianapolis, Houston, Denver, Atlanta, San Antonio and Jacksonville. Cities with lower expected employment recovery include Pittsburgh, Chicago, Los Angeles, New York, Orlando, Providence, San Francisco, Cleveland, Detroit and Las Vegas.