Frothing multifamily market as hikes in overhead push mom-and-pops out

Los Angeles rental ownership is shifting as regulatory policies and operating costs pressure small landlords. Sales activity has accelerated, with brokers reporting a surge in deal counts and total dollar volume since early 2024. Many sellers are older owners holding single properties for passive income or retirement. Pandemic-era eviction and rent protections created lingering financial strain, followed by rent stabilization rules and relocation fee requirements tied to renovations or redevelopment. Insurance and utility costs have risen, and January 2025 wildfires increased insurance premiums further. Property managers report fewer multi-generational mom-and-pop operators and more institutional buyers entering the market.

"Since the start of 2024, Maronde said his team has brokered 86 sales in the L.A. area, totaling $184.8 million. The vast majority of sellers are in their 50s, 60s and 70s and own a single property for passive income or to generate retirement savings, he said. The number of deals is up 34 percent while the dollar volume is 31 percent higher than the comparable pre-pandemic period of early 2017 to May 2019."

"The pandemic essentially pushed several years of data into outlier territory. It also caused hangover for landlords who saw eviction moratoriums and rent freezes remain long after vaccines were developed. Nowadays, they face the city's rent stabilization ordinance, hefty relocation fee requirements for renovations or redevelopments, and surging insurance and utility costs. It's a death by a thousand cuts scenario, said Anthony Luna, CEO of Coastline Equity, an L.A.-based property management firm with more than 100 commercial buildings in its portfolio, including multifamily assets."

"Historically, our bread and butter was mom-and-pop property owners that owned medium to large size assets and a lot of multi-generational families and what we're seeing now is less and less of those mom-and-pop operators, and certainly less of the multi-generational, and many more institutional clients coming into the folds, Luna said."

"Another hike in costs for landlords came in the wake of January 2025 wildfires, said Maronde. Many property owners' insurance policies have doubled or even tripled. Then there have been increases in various bureaucratic costs such as m"

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