Los Angeles Rents Hit 3-Year Low—but Most Residents Still Can’t Afford Them

Rents across Los Angeles County are beginning to ease after years of steep increases.

The median asking rent for all rental properties in L.A. County fell to $2,520 in the first quarter of 2026, down $97—or 3.7%—from the same period a year earlier, according to the first Los Angeles Rental Report from Realtor.com economists.

This marks the lowest level since early 2022, and reflects a broader cooling trend that has taken hold following the post-pandemic surge in housing costs.

The decline is even more pronounced when viewed against the market's peak.

Since reaching a high point in summer 2022, rents have dropped by $298, or 10.6%, indicating a sustained correction rather than a short-term fluctuation.

"Since then, a surge in new multifamily construction has put sustained downward pressure on the rent," says Realtor.com economist Jiayi Xu.

Biggest drops hit smaller rentals

Smaller units, particularly those with zero to two bedrooms, have seen the most significant price declines.

The median rent for these units fell to $2,241, representing a year-over-year drop of $135, or 5.7%. In contrast, larger units with three or more bedrooms experienced a more modest decline of $103, or 2.8%, bringing the median rent to $3,585.

"This trend may be partially explained by the surge in ADUs across Los Angeles County between 2022 and 2024," says Xu. "As those permitted units complete construction—typically requiring 6 to 18 months from permit to occupancy—a growing wave of new small rental units has been entering the market, adding downward price pressure concentrated in the smaller unit segment."

Although Los Angeles tenants are gaining leverage, rents are still steep.

"Supply has finally caught up, giving renters more options and more negotiating power than they've had in years," says Danielle Hale, chief economist at Realtor.com.

"But falling rents don't automatically mean affordable rents. A typical rental in Los Angeles still requires an annual household income of over $107,000, and for many families in this city, that bar remains simply out of reach."

Diverging trends across cities

Despite the overall downward trend, rent changes vary significantly across different cities within the county.

High-end markets have seen notable declines, with Beverly Hills rents falling 9.3%, Malibu dropping 3.6%, and Santa Monica decreasing 2.6%.

"Even these premium markets were not immune to the broader softening trend in the first quarter of 2026," says Xu.

Meanwhile, more transit-oriented and walkable cities have shown resilience or even modest growth.

Pasadena led with a 5.8% increase in rents, followed by Long Beach at 2.4%, and Culver City at a slight 0.2% gain.

These areas are "all well-connected by Metro rail and anchored by major employers," says Xu.

Policy changes shaping the rental landscape

The city of Los Angeles recently overhauled its Rent Stabilization Ordinance, capping annual rent increases at 4% for roughly 650,000 units—about 74% of its rental stock.

The policy, set to take effect in July 2026, is expected to generate meaningful long-term savings for tenants already in rent-stabilized units.

However, it may also reinforce a growing “lock-in” effect, where renters are increasingly reluctant to move. As Xu notes, 86.5% of renters in the city of Los Angeles already remain in the same unit year over year.

That reluctance is driven in large part by a widening affordability gap. In 2024, the median contract rent—reflecting what tenants actually pay, often under rent stabilization—was $1,804, more than $1,000 below the current median asking rent on the open market. “With the gap between staying and switching already exceeding $1,000 a month, that lock-in will only deepen,” explains Xu.

The result is a tightening of available inventory, as fewer tenants give up below-market units. According to Xu, this reduced turnover is likely to intensify competition for the limited number of apartments that do become available, pushing rents higher in the broader market and increasing the likelihood of bidding wars among prospective tenants.