November 2020 "Vacancy Tax" ballot initiative will change the way that you think about your investment properties vacancies. This would be called the "empty homes penalty".
Los Angeles City Council memebers believe that the root of homelessness in Los Angeles starts with the amount of affordable rental units. It was reported at the end of 2019 that 4% of rental units in Los Angeles (including Long Beach and Orange County) sat empty. 93,535 homes were vacant in the city of Los Angeles, although this figure did include second homes and vacation homes.
According to the experts that the city council members go off of, healthy rental markets have vacany rates that are around 7%-8%. That means if our vacany rate is at 4% that there is a housing shortage. With supply being lowered and demand being higher, landlords will raise their prices leading to the affordability challenge. In 2018 the vacancy rate was at an all time low, 3.9%, which is why the prices for rental units were so high.
Economist are predicting that there is going to be a slowing economy, but the housing is staying relatively optimistic in Los Angeles due to the rise of development.
One of the goals that the council members have in mind is to collect information on "absentee" owners that intentionally keep their units vacant.