High rents, low wages: LA rental market most unaffordable

LOS ANGELES (KABC) -- UCLA ranks Los Angeles as the most unaffordable rental market in the U.S. due to rising rents and income not keeping pace. Many L.A. renters are facing a money squeeze. A new study shows that L.A. is the least-affordable rental market in the country.

That's not to say that Angelenos pay the highest rents in the U.S. In fact, when it comes to the average rent on a two-bedroom apartment, Los Angeles ranks fifth, behind San Francisco, Washington, D.C., Boston and New York.

But in those cities, people make more money. So when it comes to making rent, people here have less to work with.

"We make less, there is a shortage of affordable units, and so then you have both of these problems colliding," said Silvia Jimenez, a researcher at the UCLA Luskin School of Public Affairs. She co-authored a new study that analyzed rental costs in Los Angeles.

Financial experts will tell you that you shouldn't spend more than 30 percent of your annual income toward rent. But in L.A., on average, renters are spending 47 percent of their paychecks on rent.

"It is also the metro area with the largest share of renters vs. homeowners: While U.S. rentership has fluctuated around 35 percent, Los Angeles is at 52 percent," the report says.

The foreclosures that came in the wake of the housing crisis, along with the high cost of home ownership, are also factors in L.A.'s rental woes. But Jimenez says low-income residents bear the heaviest burden.

"You can't just address affordability of housing. You have to address the income side of it," said Jimenez.

It's enough to make some renters consider breaking up with L.A.

For a condensed analysis of the UCLA report, visit: http://www.anderson.ucla.edu/Documents/areas/ctr/ziman/UCLA_Economic_Letter_Jimenez-Ong-Ray_8-05-14.pdf