In their economic report for the next three years, USC researchers forecast that rents will rise in all of the counties that make up Southern California.
Depending on the county, forecasters believe that renters will need to pay an average of 1.4% to 2.4% more between 2026 and 2029. USC attributed the increases to an apartment shortage and limited development, noting that the counties with the smallest increases in housing production remain the most expensive places to live.
“Housing cannot be affordable unless we have plenty of it,” said forecast author Moussa Diop. “San Diego and the Inland Empire show that there is still hope for affordability, but meaningful gains take time and sustained development.”
Researchers said that inflation, higher interest rates and increased construction costs have made building new housing difficult, causing California to fall behind other states. Between 2015 and 2025, Texas, Florida and Arizona developed more than twice as much housing as California, according to USC.
“We need to make it easier to build significant amounts of housing, at enough density, to make real progress,” Diop said. “Southern California’s housing shortage is a problem we created, but it is also a problem we can solve.”
Los Angeles County
Between 2026 and 2029, Los Angeles County’s average rent will increase 1.4% from $2,362 to $2,469, according to USC.
While researchers forecast that LA County will face the least rent growth in the next three years, USC described LA County as “one of the tightest rental markets in the country.”
They urged officials to take “an all-in approach” to address its “severe housing shortage” by expediting permitting, like what happened after the 2025 wildfires, reducing regulatory barriers for new developments and focusing on denser development to make the cost of living more affordable.
Researchers pointed to a silver lining in their forecast: permits for new apartments were 60% higher than last year’s monthly average, but they expressed concern that developments may not actually be built because of higher labor, material and financing costs.
Orange County
USC said that Orange County’s average rent will rise 1.9% from $2,792 to $2,946 over the next three years, the highest in Southern California.
Researchers described Orange County’s situation as a “persistent rental deficit,” with a pronounced affordability gap. The forecast found that average rent in the area is 18% higher than in LA County, and lower-quality units are 22% more expensive compared to LA County.
USC said multifamily housing production in the county is “paltry,” with new developments expected to shrink 40% by 2029.
“While developers continue responding to the locations and property types where investment remains viable, sustained building is required to meaningfully improve affordability across the rental spectrum,” researchers wrote.
Ventura County
As the second most expensive housing market in Southern California, USC expects Ventura County’s average rent to rise even more, from $2,675 to $2,849 by 2029.
Researchers described Ventura County as “expensive by design,” with predominantly single-family homes and relatively few multifamily housing developments. Rents in the area are on average 13% higher than in LA County, according to USC.
While the region produced roughly 850 new units, researchers believe they will do little to improve affordability because residents will fill them quickly, and new developments will drop by nearly 50% over the next three years.
“Ventura County will remain expensive by design without a significant change in both housing policy and production,” researchers wrote.
Inland Empire
USC called the Inland Empire the “last haven of relative affordability,” but a stark drop in construction led researchers to give the region the highest average rental growth at 2.4%, with rents going from $2,150 to $2,309 by 2029.
The Inland Empire, which consists of Riverside County and San Bernardino County, built 12,300 rental units, the fastest rate in all of Southern California. USC said the housing expansion helped moderate rent growth to nearly 1%, but the region faces a potential downturn if construction stalls.
Researchers said new construction projects have fallen 60% since 2024, contributing to the reason why USC gave the region the highest mark for average rental growth in Southern California.
“Continued development will be necessary if the Inland Empire plans to retain its affordability advantage,” researchers wrote.