Daryl Fairweather, the chief economist at Redfin, shared a similar viewpoint with FOX Business, stating that not only will individuals currently searching for rental properties face higher rents, but those whose leases are nearing expiration might also experience unexpected rent hikes. Fairweather mentioned that some residents are even exploring rental options as far as Santa Barbara due to the high demand near the fire zones.
Senior economist Joel Berner from Realtor.com, in an interview with FOX Business, highlighted that following the recent fires, there were significant increases in rental prices in several zip codes near the fire-affected areas from January 4 to January 11. For instance, the 90403 zip code in Santa Monica saw rents surge by 33.9%, while another Santa Monica zip code, 90404, experienced a 23% increase. Additionally, the 91125 zip code in central Pasadena also saw a 20% rise in rent during that period.
Berner noted that the rental market data is still fluctuating, with some areas in LA witnessing rent decreases week-over-week. He suggested that a full week of post-fire data would provide a clearer picture of the rental market’s overall impact.
Following California law, which limits price hikes to 10% of the pre-emergency price in the event of a declared emergency, Attorney General Rob Bonta emphasized during a recent press conference that the anti-price gouging rule extends to housing and rentals.
Zillow, a real estate marketplace featuring rental listings, informed FOX Business of their efforts to combat price gouging on rental listings in the affected regions by flagging potential violations and removing listings with price increases exceeding the state of emergency threshold. They encouraged renters to report any potential violations to Zillow and California authorities, stressing the importance of housing providers adhering to local regulations against price gouging in times of natural disasters.
UCLA Ziman Center for Real Estate director Stuart Gabriel, speaking with FOX Business, highlighted the challenges residents in the fire zones may face in rebuilding, despite owning valuable properties. He noted that some residents, particularly those in housing dating back to the 1950s and 1960s, may have limited financial resources, posing potential obstacles in the rebuilding process.
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