Rent soaring in these LA ZIP codes after California wildfires, report says

Real estate companies in Los Angeles County are being accused of price gouging in a new report, as thousands of people are looking for places to live after their homes were destroyed in the Palisades and Eaton Fires

The new report from The Rent Brigade, a group that has been tracking rental listings since the fires first broke out, showed more than 1,300 instances of price gouging on rentals in the days since the fires started.

"Put simply, this is disaster capitalism at work," the report's authors wrote.

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Both the Palisades and Eaton fires erupted on Jan. 7. On that day, Gov. Gavin Newsom declared a state of emergency. California law prohibits "excessive and unjustified" price increases on goods and services, including rentals, during a state of emergency.

Typically, that means no increases of more than 10% for listings that were available before the emergency declaration. For things like new listings and re-listed properties, those rents can't be more than 160% of the Fair Market Value in that ZIP code, which is determined by the U.S. Department of Housing and Urban Development.

The number of "rent gouged" listings, grouped by ZIP code. (Credit: The Rent Brigade)

For their report, The Rent Brigade collected data from Zillow listings from Jan. 7 to Jan. 18. They found 1,343 unique instances of listings that violated those rules. The data showed every size of rental saw major price increases in the days after Jan. 7, with rental prices for two-bedroom units growing by 80%.

In terms of sheer number of "rental gouging" listings, most of them were concentrated in Malibu, near the site of the Palisades Fire, and most of West LA.

Below is a list of the "Top 10 ZIP codes impacted by rent gouging."

Even more concerning, the report found "listings at the lower end of the price spectrum are seeing significantly higher illegal rent hikes compared to those at the upper end." 

The group also found a number of "repeat actors," who were tied to multiple instances of price gouging. Compass was found to be the top offender in the report, with nearly 60 property listings in violation of the rules for both existing and new listings. According to the Rental Brigade, Compass listed properties at prices nearly 900% higher than their fair market value.

FOX 11 has reached out to Compass for comment, but has not heard back.

"Landlords and brokers are exploiting the current crisis to extract millions of dollars from tenants unlawfully," the report's authors wrote. "This is a textbook example of disaster capitalism, where greed flourishes in the midst of crisis, leaving displaced individuals and precariously housed tenants to bear the brunt of exploitation."

Real EstateConsumerWildfiresLos Angeles CountyHousing