Renters Caught in a Crunch

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If home prices are plunging, then why are rents going up? That’s a question Lynn Washington wants answered. The lease on his Marina del Rey apartment is expiring, and he can’t find anything to rent for his budget of $1,000 a month, the Los Angeles Times rerpots.


“It boggles the mind,” said Washington, 59, who works as a liaison for international students at Santa Monica College. “I don’t make enough to buy. And yet I don’t make enough to afford to rent. I’m caught between the two.”


Apartment rents are indeed climbing, hitting an average of $1,494 a month in Southern California for the last three months of 2007, an increase of 4.5% over the same period a year earlier, according to a survey of larger apartment complexes by RealFacts, a property research firm.


Yet housing prices are falling sharply. The median price for homes and condominiums in the six-county region fell to $415,000 last month, 18% below last year’s peak, according to DataQuick Information Systems.


But just because home prices are falling doesn’t mean rents should be dropping too. In fact, home values and rents often move in opposite directions, real estate analysts said.


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