Home economics: Sustained housing price growth will maintain demand for the industry

The Apartment Rental industry in California is one of the largest in the United States. Over the five years to 2017, the industry has exhibited strong growth as demand for apartment rentals has strengthened, especially in relation to the rest of the country. For example, homeownership rates have fallen across California, as housing prices have grown faster than the US average. Over the five years to 2022, the industry is forecast to continue growing, albeit at a slower pace compared with the previous five-year period. New residential development is projected to outgrow the pace of absorption, which will cause vacancy rates to rise across the state...read more.

Industry Statistics & Market Size
Revenue
$31bn
Annual Growth 12-17
4.9%
Forecast Growth 17-22
Profit
Employment
92,260
Businesses
53,901
What Our Customers Say

Industry Threats & Opportunities

  • Growth has been concentrated in metropolitan areas like Los Angeles, which represents the largest real estate market in the state
  • California apartment vacancy rates have declined faster than the national average
  • Sustained growth in California housing prices will benefit the industry
  • Industry Report - Industry Products Chapter

    The Apartment Rental industry in California is composed of players acting as lessors of buildings used as residences or dwellings, including apartment buildings, single-family homes and townhomes. Owner-lessors are included in this industry, as are companies and individuals who rent property and then act as lessors in subletting the space to others.Apartments are rental units situated within buildings or complexes with five or more units, while the townhome segment of the industry includes properties with two to four units. The single-family home sector is made up of traditional houses and leasable manufactured or mobile homes.Rental units are generally differentiated by type, style, size and location. Uni...purchase to read more.

    Additional Insights for the Apartment Rental in California Industry

    IBISWorld identifies 250 Key Success Factors for a business.The most important for the Apartment Rental in California Industry are

  • Financial structure of the company
  • Management of a high-quality assets portfolio
  • Superior financial management and debt management
  • IBISWorld analysts also discuss how external factors such as Home Price Index in California and Homeownership Rate in California in the Apartment Rental in California industry impact industry performance..

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    What is the Apartment Rental in California Industry?

    Operators in this industry act as lessors of buildings used as residences or dwellings in the state of California. Industry participants are owner-lessors of residential buildings and establishments that rent real estate and then act as lessors by subleasing it to others. In addition to apartment rentals, the industry also includes single-family homes and town houses.

    Industry Products
  • Rental of one-unit structures
  • Rental of two- to four-unit structures
  • Rental of five- to nine-unit structures
  • Rental of 10- to 19-unit structures
  • Rental of 20- to 49-unit structures
  • Rental of 50- or more unit structures
  • Rental of manufactured homes, mobile homes or trailers
  • Industry Activities
  • Renting or leasing residential buildings
  • Renting or leasing residential dwellings
  • Similar Industries
  • Real Estate Investment Trusts
  • Commercial Leasing
  • Storage & Warehouse Leasing
  • Land Leasing
  • Property Management
  • Commercial Leasing in California
  • Storage & Warehouse Leasing in California
  • Apartment Rental in New York
  • Commercial Leasing in New York
  • Storage & Warehouse Leasing in New York
  • Apartment Rental in Illinois
  • Commercial Leasing in Illinois
  • Commercial Leasing in Texas
  • Apartment Rental in Texas
  • Apartment Rental in Florida
  • Commercial Leasing in Florida
  • Apartment Rental in Massachusetts
  • Commercial Leasing in Massachusetts
  • Commercial Leasing in Ohio
  • Apartment Rental in Ohio
  • Apartment Rental in Pennsylvania
  • Commercial Leasing in Pennsylvania
  • Apartment Rental in New Jersey
  • Commercial Leasing in New Jersey
  • Commercial Real Estate in New Jersey
  • Apartment Rental in Georgia
  • Commercial Leasing in Georgia
  • Commercial Real Estate in Georgia
  • Apartment Rental in Michigan
  • Commercial Leasing in Michigan
  • Commercial Real Estate in Michigan
  • Apartment Rental in Wisconsin
  • Commercial Leasing in Wisconsin
  • Commercial Real Estate in Wisconsin
  • Apartment Rental in Washington
  • Commercial Leasing in Washington
  • Commercial Real Estate in Washington
  • Apartment Rental in Virginia
  • Commercial Leasing in Virginia
  • Apartment Rental in Tennessee
  • Commercial Leasing in Tennessee
  • Apartment Rental in Missouri
  • Commercial Leasing in Missouri
  • Apartment Rental in North Carolina
  • Commercial Leasing in North Carolina
  • Storage & Warehouse Leasing in North Carolina
  • Apartment Rental in Minnesota
  • Commercial Leasing in Minnesota
  • Commercial Real Estate in Minnesota
  • Apartment Rental in Maryland
  • Commercial Leasing in Maryland
  • Commercial Real Estate in Maryland
  • Apartment Rental in Colorado
  • Commercial Leasing in Colorado
  • Table of Contents

    Industry Definition
    Main Activities
    Similar Industries
    Additional Resources
    Industry Statistics Snapshot
    Industry Structure
    Executive Summary
    Executive Summary
    Key External Drivers
  • Home Price Index in California
  • Homeownership Rate in California
  • Number of Adults Aged 20 to 64 in California
  • Unemployment Rate in California

  • Current Performance
  • Declining vacancy rates
  • Greater development
  • Chart: Revenue Growth

  • Industry Outlook
  • Rising vacancy rates
  • Affordability challenges
  • Table: Apartment Rental in California Industry Revenue Outlook

  • Industry Life Cycle
  • Life cycle reasons
  • Chart: Benchmarking - Apartment Rental in California Industry Lifecycle vs The Economy

  • Supply Chains
    Key Buying Industries
  • Finance and Insurance
  • Retirement & Pension Plans

  • Key Selling Industries
  • Construction
  • Finance and Insurance
  • Landscaping Services
  • Property Management
  • Real Estate Sales & Brokerage
  • Utilities

  • Products & Services
  • Rental of one-unit structures
  • Rental of two- to four-unit structures
  • Rental of 50- or more unit structures
  • Rental of five- to nine-unit structures
  • Rental of 20- to 49-unit structures
  • Rental of 10- to 19-unit structures
  • Rental of manufactured homes, mobile homes or trailers
  • Chart: Apartment Rental in California Industry Products and Services Segmentation

  • Major Markets
  • 1 person
  • 2 persons
  • 4 or more persons
  • 3 persons
  • Chart: Major Market Segmentation for the Apartment Rental in California Industry

  • Business Locations
    Chart: Business Locations by State
    Market Share Concentration
    Key Success Factors
    Cost Structure Benchmarks
    ProfitDepreciationWagesPurchases and marketingRent and utilitiesOther
  • Chart: Cost Structure Benchmarking – Sector vs Apartment Rental in California

  • Basis of Competition
  • Internal
  • External

  • Barriers to Entry
  • Table: Barrier to Entry Checklist for the Apartment Rental in California Industry

  • AvalonBay Communities Inc.Equity ResidentialEssex Property Trust Inc.The Irvine Company
  • Table: AvalonBay Communities Inc. - financial performance
  • Table: Equity Residential - financial performance
  • Table: Essex Property Trust Inc. - financial performance
  • Table: The Irvine Company - financial performance

  • Capital Intensity
  • Chart: Level of Capital Intensity for the Apartment Rental in California Industry
  • Chart: Tools of the Trade: Growth Strategies for Success

  • Technology & Systems
    Revenue Volatility
  • Chart: Volatility vs Industry Growth

  • Regulation & Policy
    Industry Assistance
    Table: Industry Data for the Apartment Rental in California Industry
    Includes:
  • Industry Revenue (2008-2022)
  • Establishments (2008-2022)
  • Businesses (2008-2022)
  • Employment (2008-2022)
  • Wages (2008-2022)
  • Homeownership Rate in California (2008-2022)

  • Table: Annual Percentage Change for Key Industry Data
    Table: Key Ratios for Industry Key Data
    Dwelling
  • Another name for an apartment or home.
  • Funds From Operations
  • Funds used to define cash flow from operations for REITs that are calculated by adding depreciation and amortization expenses to earnings.
  • Leadership In Energy And Environment Design (Leed)
  • An eco-oriented building certificate program established under the US Green Building Council. LEED-certified buildings are energy efficient and green certified.
  • Occupancy Rate
  • The amount of occupied real estate space as a percentage of total available space.
  • Real Estate Investment Trust (Reit)
  • A legal entity that uses pooled investor capital to purchase and manage income property or mortgage loans. To qualify as an REIT, the entity must distribute at least 90.0% of taxable income.
  • Rental Agreements
  • An agreement with no set period of occupancy in which landlords and tenants are free to make changes to the contract at the end of each 30-day period.
  • Vacancy Rate
  • The amount of unoccupied real estate space as a percentage of total available space.
  • Why buy this report?

    IBISWorld’s Apartment Rental in California Industry Research Report offers insight into the market at the national level. Our analysis highlights macro trends in the overall sector and the micro trends faced by companies that do business in the Apartment Rental in California industry. Our five-year outlook forecasts explain how the market is set to change and the product segments that will drive growth.

    IBISWorld industry market research reports enable you to:
    • Find out about key industry trends
    • Identify threats and opportunities
    • Inform your decisions for marketing, strategy and planning
    • Quickly build competitive intelligence
    This report on Apartment Rental in California:
    • Provides Market Size information to assist with planning and strategic decisions.
    • Includes the necessary information to perform SWOT, PEST and STEER analysis.
    • Helps you understand market dynamics to give you a deeper understanding of industry competition and the supply chain.
    • Analyses key performance and operational metrics so that you can benchmark against your own business, that of your customers’ businesses, or your competitors’ businesses.
    The Apartment Rental in California market research report includes:
    • Historical data and analysis for the key drivers of this industry
    • A five-year forecast of the market and noted trends
    • Detailed research and segmentation for the main products and markets
    • An assessment of the competitive landscape and market shares for major companies
    • And of course, much more

    IBISWorld reports on thousands of industries around the world. Our clients rely on our information and data to stay up-to-date on industry trends across all industries. With this IBISWorld Industry Research Report on Apartment Rental in California, you can expect thoroughly researched, reliable and current information that will help you to make faster, better business decisions.

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