It’s been a crazy year both for tenants and landlords here in the Conejo Valley. Although we don’t have as many short-term rentals as our neighbors in Malibu, the Westside or even up north in the Ventura/Oxnard beach communities, we still had a lot of upheaval in the long-term rental markets as half of all renters say now is the time to move.
Prices for real estate in all areas have skyrocketed in the last year as the lock-downs forced many to re-think what was really important to them. Larger homes with bigger family spaces became a priority. Also more room in the yard for the kids was critical as values shifted. Home buyers weren’t the only ones impacted.
Renters struggled as more jobs in the service industries were curtailed or plain eliminated altogether. Restaurants, bars, and wineries struggled to manage past their lost customers. Micro breweries and wine pubs in the area were temporarily shuttered. Some closing for good. I know that I certainly missed seeing friends at local places such as 14 Cannons or The Stonehaus. Thankfully, many have been migrating back to these familiar places. Not all is lost!
“2020 was a life changing year for people, industries and businesses across the globe”
Many service jobs in other industries were heavily impacted as the move to online commerce was the safer bet for most during COVID. Hourly wage earners were the most negatively impacted with so many lost jobs. If you were lucky enough to keep your job you stayed in place. If not, then you are one of the many that uprooted and moved.
Moving Back Home
Renters say now is the time to move. But where are they going? In a survey by property management firm Entrata, more than half of all renters (56%) plan on finding a new place to live. And not surprising, they found that a small number of the younger renters are going home again. Sorry Moms & Dads – the back door was left wide open. Fourteen percent of Gen Z’ers are already back at home in their former teen bedrooms with their poster covered walls and messy closets. Another twenty two percent have moved to larger properties in search of more space, according to the survey.
20% of the Gen Z crowd did the opposite and moved from rural areas to more fast paced cities such as Houston or New York. The reason? Vacancy rates kept climbing as many city dwellers lost their jobs. This necessitated rent decreases of 5% to upwards of 12% in many downtown areas. I have a client in Manhattan, N.Y. that said while many moving vans were on the streets in March-June of 2020, they were fortunate to see only a few vacancies in the buildings that they own.
Prices Continue to Climb in the Conejo Valley
We’ve seen large home sale price jumps throughout the past year in our area. In Agoura Hills, the median sales prices were up 17.7% so far in 2021, from $867,500 to $1,000,000. In Moorpark, the median sales price is a bit more reasonable at $795,000. Prices overall in our area are up across the region in double digits for the year. Housing experts anticipate a minor slow down for the next 12 months. It’s no wonder the gap between renting and owning continued to grow wider each month and this is the reason many renters say now is the time to move.
“2020 was a life changing year for people, industries and businesses across the globe,” said Chase Harrington, Entrata’s president and chief operating officer. “Our survey of US renters shows that many moved to larger spaces to accommodate work from home needs, moved back to hometowns and some even moved to the city to take advantage of lower rental rates. There’s a clear shift in the industry as renters look for more flexible leasing options and think differently about apartment amenities.”
Abatement Program Helped
The rent moratoriums in California left a lot of renters and landlords in limbo. Rent increase limits were lowered and evictions were halted. Those moratoriums will be lifted soon and we expect to see a lot of movement in the market at that point. Landlords that jumped on the statewide abatement program were able to recoup lost rent. Another client felt it was better to take 80% of the rent owed rather than to lose in court. What’s the old saying about a bird in the hand?
The growing gap between the cost of renting and purchasing a home will get worse before it gets better. 39% of renters surveyed said that they cannot afford a down payment in today’s market. They also said that the cost to maintain a home was a reason not to purchase a home. On the positive side the survey found that many have adapted to working from home and appreciate saving money and the time in commuting for work, wear & tear on their cars, eating lunches at work, etc.
Only time will tell how we transition back to a “normal” life.