About 10,600 new apartments delivered in Los Angeles through the third quarter of 2026, down 18% from 2025. What the data means for owners.
What Actually Delivered in 2026
Forecasts for new Los Angeles apartment supply in 2026 varied more than usual. At the low end, CoStar data cited by Matthews pointed to fewer than 6,000 units. At the high end, RealPage projected about 12,300. Owners who planned around either number should look at what happened.
Through the third quarter of 2026, about 10,600 units had delivered, according to Kidder Mathews and CoStar. That is 18% below the same period in 2025, but it is nowhere near a decade low. Supply slowed. It did not collapse.
The Numbers at a Glance
| Measure | Latest figure | Source |
|---|---|---|
| Units delivered, first three quarters of 2026 | About 10,600, down 18% year over year | Kidder Mathews / CoStar |
| Units under construction | About 24,300, down 11% year over year | Kidder Mathews / CoStar |
| Vacancy, third quarter 2026 | 5.4%, up slightly from a year earlier | Kidder Mathews / CoStar |
| Average asking rent | $2,323, up 0.6% year over year | Kidder Mathews / CoStar |
| Average cap rate | About 5.9% | Kidder Mathews / CoStar; Northmarq |
Where New Units Are Concentrated
New supply is not spread evenly. Northmarq expected Downtown Los Angeles (about 5,100 units) and West Los Angeles (about 1,200 units) to take a significant share of 2026 deliveries. RealPage also flagged Mid-Wilshire (about 3,000 units), Hollywood and Southeast Los Angeles.
The practical point for an owner is local. A 1960s building in Sherman Oaks competes with different product than a building two blocks from a new Downtown tower. Before drawing conclusions about your building, look at what is delivering within your own submarket.
What the Data Says About Rents and Vacancy
Slower deliveries have not yet produced a landlord's market. Vacancy edged up to 5.4% and asking rents were close to flat. Two things follow:
- Newer buildings in lease-up face the most direct competition, because they compete with each other for the same renters
- Older, established buildings are less exposed to new product, but should not assume rent growth simply because construction has slowed
For rent-stabilized buildings, the main source of rent growth remains turnover, when a unit can reset to market after a voluntary move-out.
Why the Pipeline Is Shrinking
Units under construction are down 11% from a year ago, which points to fewer deliveries in coming years. Several factors are holding starts back:
- Construction costs: A 2025 RAND study found multifamily production costs in the Los Angeles area are about 2.5 times the Texas average
- Financing: Fannie Mae and Freddie Mac loan purchase caps rose to $88 billion each for 2026, from $73 billion, which helps buyers of existing buildings more than it helps construction lending
- Replacement rules: Demolishing occupied apartments triggers replacement-housing obligations; see why redevelopment rarely pencils in LA
- Interest rates: Borrowing costs remain well above the levels that financed the last building cycle; see how rates affect apartment values
Investment Sales Have Picked Up
While new construction slowed, sales of existing buildings recovered. According to Northmarq, the number of Los Angeles multifamily sales rose 52% in 2025, and the first half of 2026 was the most active first half since 2022. The median price rose 18% to about $368,800 per unit, with cap rates averaging about 5.9%.
Those are metro-wide figures. Pricing for a specific building depends on its rents, condition, rent-regulation status and location.
What This Means for Different Owners
Long-Term Holders
A shrinking pipeline is a modest tailwind over several years, not a reason to expect near-term rent growth. Focus on what you control: turnover rents, expenses and the building's condition.
Value-Add Investors
Buildings with below-market rents or renovation upside are trading. Underwrite achievable rents against current vacancy in the submarket rather than against a scarcity story.
Potential Sellers
Buyer activity is the strongest it has been since 2022. That matters more to a sale today than the supply forecast does. If you are weighing timing, see when to sell an apartment building in Los Angeles.
What Could Change the Picture
- SB 79: The state transit-housing law took effect July 1, 2026, but the City of Los Angeles deferred it until about 2030; see SB 79 in Los Angeles
- Adaptive reuse: AB 507 and the city's own ordinance make commercial conversions easier
- Interest rates: Lower rates would improve development economics, but owners should not plan around them
Even if starts recover, new projects take years to move from planning to delivery.
The Bottom Line
New supply in Los Angeles slowed in 2026 and the pipeline is smaller than it was a year ago. It did not fall to a decade low, vacancy did not tighten, and rents were roughly flat. The stronger story for owners this year is on the sales side, where buyer activity has recovered.
Sources
- Kidder Mathews: Los Angeles multifamily market report, third quarter 2026
- Northmarq: Los Angeles multifamily transactions accelerate through midyear, Q2 2026
- Northmarq: Los Angeles multifamily market report, Q4 2025
- RealPage Analytics: Los Angeles supply outlook
- Matthews: Los Angeles multifamily market report, Q4 2025
- Federal Housing Finance Agency: 2026 multifamily loan purchase caps
- RAND: multifamily housing production costs (2025 news release)
This article is general market commentary, not investment, legal or tax advice. Figures were checked against the sources above on November 5, 2026 and will change. Forecasts cited here are the publishers' own.
Questions about your building's value in today's market? Request a valuation to discuss.