Thanks to Justin Chaplin at apartmentlist.com for the post below, which shows how San Diego’s rental stock is aging rapidly (fastest among the largest 25 US metros) due to our lack of rental construction in the past decade. Despite some recent positive developments, like the potential for 10,000 new housing units in the recently approved Midway Community Plan, these will probably do little to reverse the trend. NIMBY victories like last month’s hat trick of blocking building height increases at all three new Clairemont/Morena Mid-Coast Trolley stations guarantee our housing crisis won’t improve anytime soon.
Why Renters Pay More For Less in San Diego
A new study from Apartment List explored the role that aging housing plays in maintaining affordability — an overlooked factor which if ignored, could exacerbate the housing affordability crisis in the years to come. In a healthy market, buildings become less desirable as they age, and older units serve as an important source of market-rate affordable housing
Without a sufficient supply of new construction, demand will remain high for older buildings, preventing their rents from falling. This is the trend that has been analyzed in recent years. In fact, the share of rental units less than 10 years old is currently at an all-time low.
Since 2000, the share of rental units that are over three decades old has increased by more than 20 percentage points in nine of the 25 largest metros, all located in the Sunbelt. San Diego is the metro seeing the largest effects. In 2000, 40% of San Diego rental units were more than 30 years old. This share increased to 67% by 2016.
Older rental units are still a consistent source of affordability in San Diego. However, despite a recent boom in rental construction, the share of rental units built in the last decade fell to an all-time low. This is one of the main reasons why rent prices in San Diego have been growing the fastest in the oldest building cohorts.
For more information on local rental trends, check out the September San Diego rent report here.