California, USA – September 18, 2025
The rental housing market in California is showing signs of slowing down, but tenants are still paying some of the highest rents in the nation. While rental growth has eased compared to the pandemic surge, affordability remains a major challenge for millions of households.
Recent surveys reveal that California’s average monthly rent is among the highest in the United States, with coastal cities continuing to lead in pricing. In Los Angeles, tenants pay an average of $2,700 per month, while San Francisco remains the most expensive, with rents for a one-bedroom unit averaging above $3,000. San Diego follows closely, with average rents around $2,600. Even in more affordable inland regions like Sacramento and Riverside, average rents have climbed above $1,800, putting pressure on middle-class families.
Experts say the crisis is rooted in a severe housing shortage that has plagued California for decades. Strict zoning laws, limited construction, and high land prices restrict the development of new homes. Rising interest rates have also discouraged home buying, pushing more people to remain in the rental market.
Regional Snapshot
- Bay Area: Extremely high rents due to tech salaries and limited supply.
- Los Angeles: High demand across neighborhoods tied to jobs and culture.
- Inland cities: Growing demand as renters seek affordability outside the coast.
For many renters, the burden is unsustainable. Nearly half of all renter households in California are classified as cost-burdened, spending more than 30 percent of their income on rent. The problem has also contributed to the state’s worsening homelessness crisis, which now accounts for nearly one-third of the homeless population in the entire country.
Local governments have introduced rent control policies in cities such as Los Angeles, San Francisco, and Oakland, limiting annual rent increases. Meanwhile, state officials are working on broader housing reforms. Governor Gavin Newsom has promised to build 2.5 million new homes by 2030, but housing advocates argue progress is too slow to meet urgent needs.
Despite these efforts, analysts predict California’s rental market will remain tight. While some relief may come from new developments and shifting demand to inland areas, most tenants will continue to face high rents in the years ahead.
Source: Local Housing Desk, regional rental indexes