Riverside County Leads in Apartment Construction Growth

Riverside County has experienced a remarkable 154.1% year-to-year growth in apartment completions, making it the third largest growth rate in the nation, according to RentCafe.com. This surge in apartment production comes as the region continues to undergo significant economic transformation, contributing to a robust population increase.

The areas of Beaumont and Riverside have been key players in this development boom, with major constructions significantly enhancing the county’s rental stock. Amid this progress, Riverside stands in stark contrast to Los Angeles, where high construction costs and uncertain profit potential have made apartment building increasingly challenging.

In Los Angeles, the supply of new rental units has been dwindling, despite a pressing demand for housing. Vacancy rates in the city are among the lowest in the United States, yet the number of apartments currently under construction has been declining each quarter since early last year. Reports indicate that Los Angeles is set to reach a 10-year low in new construction, with fewer than 19,000 units underway, marking a 30% decrease compared to three years prior.

Developers in Los Angeles face numerous hurdles. For instance, Ari Kahan from California Landmark Group notes that they have not purchased new sites for development in over two years due to financial difficulties and the uncertain prospects from funding institutions. Additionally, rising material costs, particularly due to tariffs, have significantly impacted construction. Key materials such as iron and steel have seen a price increase of 9%, while copper has risen by 14%.

An important aspect influencing the construction industry in California is the reliance on immigrant workers, who comprise 61% of the state’s construction workforce. Among them, 26% are undocumented individuals. This labor dynamic is critical to consider, especially against the backdrop of the state’s prolonged housing production slump. Long-term housing production in Los Angeles County has drastically decreased, from over 70,000 units in the 1950s to less than 15,000 annually during the 2010s.

The rising costs for new apartments have led to significantly higher rental rates in Los Angeles, setting prices between $4,000 and $5,000 per month. Such rates create serious affordability issues for renters. RentCafe estimates that to afford a monthly rent of $4,000, a household would need a gross monthly income of approximately $13,400.

Riverside County’s recent growth contrasts sharply with the stagnation facing Los Angeles. In 2024, Riverside’s population surged by 26,384, an increase of about 1.1% from the previous year and a remarkable 15.5% increase since 2010. Concurrently, Riverside’s median home prices have surged 45% over the last five years, with the current median home price reaching $650,497 as of July 2025.

Housing development trends reflect different trajectories throughout California. While Riverside County is witnessing significant growth, American Canyon in Napa County recorded the highest multifamily housing growth in California at 44.58%. Wildomar, also in Riverside County, ranks eighth with a year-over-year growth of 10.16%.

Conversely, the San Francisco Bay Area has experienced a notable decline in apartment completions, recording a 51% drop in 2025, marking the most significant downturn in a decade. Meanwhile, San Diego County is making strides, having met 84% of the state-mandated housing development targets within four years.