UPDATES:
Nov. 23, 2:20 p.m.: Joe Delgado, director of Alliance of Californians for Community Empowerment Los Angeles, one of the groups that co-authored the report, confirmed in an email that co-authors had removed the report from the internet.
"It has come to our attention that there is more recent data to draw on the 10 luxury buildings we sampled in LA," Delgado wrote. "We will be coming out with an updated report, so we have taken down the last version of the report until that (sic) then."
1:45 p.m.: The authors of the report appear to have removed it from the internet after LAist presented updated vacancy figures that put into question the report's methodology. A spokesperson did not answer a request for clarification on Saturday. We will update the story with more information when we get it.
This article was originally published on Nov. 20 at 3:30 p.m.
At least 36,000 homeless people live in the city of Los Angeles, but L.A. potentially has more than 41,000 empty housing units, according to a report released Tuesday by UCLA law students and a coalition of economic justice organizations.
Researchers from the UCLA School of Law and nonprofit groups Strategic Actions for a Just Economy and the Alliance of Californians for Community Empowerment, who authored the report, found many of these units were purchased or built as long-term financial investments, and that allowing them to sit unoccupied worsens the region's housing shortage.
The findings quantify the number of apartments and condominiums that appear to be investments and/or second homes. However, updated figures obtained by LAist found the report's vacancy figures out of date and inflated.
The research used in the report was based on an analysis of property ownership records obtained through the Los Angeles County Office of the Assessor and the commercial real estate information service, Co-Star.
THOUSANDS OF EMPTY HOMES
Besides taking a look at L.A.'s housing market on the whole, the report also zeros in on vacancies in recently built, luxury residential housing.
Researchers analyzed 10 high-end apartment buildings in Downtown Los Angeles and 25 high-end condominium buildings around the city.
In the 10 downtown buildings, researchers found an average vacancy rate of over 70% in April 2019, using information provided by CoStar. Most of the buildings were ready to be occupied in 2018 or earlier, though two weren't completed until 2019.
These are buildings where the asking rate for a 750 square-foot, 1-bedroom apartment can soar far north of $3,000 a month.
Vacancy rates in the 10 buildings have dropped to 30% since the study was carried out, according to data supplied by CoStar to LAist. In hard numbers, that means 1,544 of 2,809 vacant units in those 10 buildings were filled between April and November.
Still, the vacancy rate in the studied buildings is well above the overall housing vacancy rate, 6.4%, for the city of Los Angeles, according to the most recent American Community Survey data (2017).
Despite the high vacancy rate, researchers suggest rents in the building remain high because the owners are betting on affluent residents moving in eventually.
"When developers put up exclusive luxury buildings that rent for more money a month than the residents currently living in a neighborhood make, they are making a speculative bet on what that neighborhood will look like in the future," the authors wrote.
The report also examined ownership records for 25 condominium buildings in Los Angeles.
Condos, unlike rented apartments, can be individually bought and sold on the real estate market. Authors claim that roughly 71% of the condos in the buildings they examined were "effectively vacant," meaning they are not used as a primary residence. They could, however, be rented out to tenants, which is not contemplated in the data.
Report authors also found that 46% of the condos they examined were owned by corporations or institutional investors.
A VACANCY TAX IN LOS ANGELES?
Report authors recommend lawmakers pursue a tax on vacant homes. They say such a penalty would discourage the practice of investing in vacant housing stock purely for financial gain.
In June, several members of the L.A. City Council proposed developing a vacant homes penalty in L.A. Their motion asks city departments to determine how many vacant homes there are in Los Angeles and why they remain vacant, though the study is yet to be completed.
The motion also says this information could potentially be used place a vacancy tax on the city ballot for voters to consider sometime in 2020.
Under state law, any such tax requires voter approval to become effective.
San Diego County leaders are also considering a vacancy tax on homes. Voters in Oakland passed a tax on vacant land in November of 2018. And San Francisco's Board of Supervisors may place a tax on empty storefronts before voters in March 2020.
UPDATES:
Nov. 22, 2019, 1 p.m.: This article was updated with information on current vacancy rates for the 10 apartment buildings examined in the report.
This article was originally published on Nov. 20 at 3:30 p.m.
Read the full report below:
