Q1 San Fernando Valley Multifamily Market Report
North San Fernando Valley Submarket Overview
San Fernando, Granada Hills, Lake View Terrace
North San Fernando Valley has experienced steady demand for rental units, positioning it as one of the more competitive submarkets in the L.A. metro. Rent prices have remained relatively stable over the past year, slightly below the metro-wide average. In terms of sales, the submarket saw modest apartment transaction volumes last year. Challenges such as rising debt costs and the implementation of new transfer taxes in Los Angeles have impacted pricing dynamics in the area, leading to a decrease in average unit prices compared to previous years.
North San Fernando Valley Submarket Performance
Demand for rental units has remained consistent, with 55 units absorbed over the past year, contributing to a vacancy rate of 2.3%, which is below the long-term average of 3.3%. Despite stable rent prices averaging $2,070 per month, the submarket has experienced significant rent growth over the past decade, with an average annual growth rate of 3.9%. Additionally, the past three years have seen the addition of 55 net new units, including Olive Tree Gardens, a 43-unit community in Sylmar.
Recent multifamily sales totaled $124 million, the highest dollar volume ever recorded in the submarket. Rising debt costs for multifamily purchases have impacted pricing dynamics, resulting in a decline in the average price per unit by approximately 15% from its peak in early 2022. Despite the higher then normal interest rates, there were notable transactions such as the sale of Summerset Village, a 280-unit community in Chatsworth, exemplify the evolving market conditions and pricing trends within the submarket. The 12-month sales volume stands at $152 million, with the average market price per unit currently at $390,000.
North San Fernando By The Numbers | Last 12 Months | Source: CoStar Group
- Vacancy Rate: 2.3%
- Rent Growth: 0.3%
- Delivered Units: 41
- Absorbed Units: 55
- Sales Volume: $121M
West San Fernando Valley Submarket Overview
Chatsworth, West Hills, Canoga Park, Winnetka
The West San Fernando Valley multifamily submarket presents an array of residential options across neighborhoods like Encino, Tarzana, Woodland Hills, and Canoga Park. With its convenient access to major transportation routes like the Ventura (101) Freeway and the Ronald Reagan (126) Freeway, as well as an abundance of amenities such as shopping centers, dining options, and recreational facilities, the submarket maintains its appeal as a desirable residential destination.
West San Fernando Valley Submarket Performance
In recent periods, the West San Fernando Valley submarket has observed reduced renter activity, with a net absorption of -52 units over the past year. Despite this, vacancy has increased to 3.1%. The submarket continues to be one of the tightest in the region. Rent prices have risen by 2.3% annually, with average rents standing at $1,970 per month. Currently, the only multifamily development under construction is phase two of 24 by Uncommon, part of the redevelopment of Chatsworth’s former L.A. Times printing plant into a mixed-use campus. In the past year, the West San Fernando Valley submarket saw transactions involving three buildings totaling $7.7 million. This activity is attributed to higher financing costs impacting investor behavior and asset pricing.
The average market price per unit has decreased by 15-20% from its peak in Q1 2022, with average market cap rates increasing by 75-100 basis points. Recent notable transactions include the purchase of an 11-unit property in Canoga Park, a 22-unit property in Winnetka, and a four-unit building, all reflecting varying cap rates and market conditions within the submarket.
West San Fernando Valley By The Numbers | Last 12 Months | Source: CoStar Group
- Vacancy Rate: 3.1%
- Rent Growth: 2.3%
- Delivered Units: 0
- Absorbed Units: -52
- Sales Volume: $7.8M
