Ongoing housing shortage keeps the rental market tight across the region
SAN DIEGO (Dec. 6, 2016) — The average rent for all apartments in the San Diego region rose to $1,719 this fall, up from an average of $1,560 last spring and $1,513 one year ago, according to the San Diego County Apartment Association’s (SDCAA) Fall 2016 Vacancy and Rental Rate Survey.
The weighted average rent for one-‐bedroom units countywide grew more than any other unit type, from $1,368 last spring to $1,531 this fall. Units with three or more bedrooms also saw an increase, from $2,082 last spring to $2,323 this fall. Studios rose from $1,084 to $1,128, while two-‐bedroom units rose from $1,637 to $1,789.
“Rising rents reflect the ongoing housing shortage in San Diego County,” said SDCAA Executive Director Alan Pentico. “The number of people looking to rent keeps growing, but the supply of rental housing is not growing anywhere fast enough to meet that growing demand.”
The vacancy rate in residential rental units across San Diego County now stands at 5.4 percent, a slight increase from the 4.5 percent vacancy rate reported last spring. In the city of San Diego, the vacancy rate remained lower, at 3.4 percent compared to 3.2 percent last spring. Vacancy rates in other parts of the county dropped significantly, from 6.3 percent to 3.7 percent in South County, and from 6 to 3.2 percent in East County. The decline in vacancies in South and East County may mean that new developments that had just come on the market during the last survey are now fully leased.
The most likely explanation for the countywide rise in average vacancy rate was a significant increase in vacancies reported in North County, where the survey found a vacancy rate of 11.5 percent compared to 2.8 percent last spring. Much of the North County anomaly can be attributed to two outliers — large complexes in Vista and Oceanside that reported numerous vacancies.
Studios and one-‐bedroom units continue to have the lowest vacancy rates, at 3.1 percent and 4.6 percent, respectively. The rate for two-‐bedroom units is 6 percent, while the rate for three-‐bedroom units is 5.9 percent.
“While we’ve seen a fair amount of construction and development activity around the county over the past six months, the amount of new residential construction has actually declined this year compared to 2015,” Pentico said.
Due to inconsistencies in the number of survey responses by ZIP code, it is difficult to ascertain a clear picture of the overall change in rent by region. For those interested in this information, SDCAA’s analysts suggest examining rents reported in individual ZIP codes and further analyzing changes through additional research.
About the survey: The SDCAA Vacancy and Rental Rate survey is conducted twice a year to provide a snapshot — not a scientific study — of industry conditions. The Fall 2016 survey was mailed in September to nearly 6,000 rental property owners and managers in San Diego County. The responses SDCAA received in this survey period represent 21,174 rental units. To ensure the results reflect the diversity of rental housing in the county, surveys are mailed to properties of all sizes, ages and amenity levels. Because survey response rates fluctuate over time, comparisons between survey periods do not necessarily reflect the performance of a particular sample of rental units over time.
About SDCAA: The San Diego County Apartment Association is a non-‐profit organization that has served the rental housing industry since 1919. SDCAA’s 2,200 members are rental property owners, rental property managers and suppliers of goods and services to the rental housing industry. The overall improvement of the rental housing industry is a primary focus of SDCAA, which represents single-‐family rental homes to the largest multi-‐family rental communities. SDCAA provides a wide range of services to its members, including legislative advocacy, education and resident screening. You can follow SDCAA on Twitter and Facebook.