Can San Diego County slow price increases by building more homes?
Despite rising wages and low unemployment, the San Diego County housing market is at a standstill. Boomers are looking to downsize while millennials have the desire to buy but the housing crisis continues as prices skyrocket.
Currently, sales of homes are in decline and inventory of resale homes is at around two months, when it should be closer to six. People who wish to sell or rent elsewhere can’t due to lack of replacements.
The San Diego Union-Tribune investigated whether it might be possible to slow the pace of price increases by building more housing in the region, and they were left with three major findings. Zoning changes, with an emphasis on townhomes and reduced regulation, would likely speed up construction. The biggest hurdles continue to be anti-growth sentiments and lack of land zoned for housing. Finally, solutions for the future may include streamlined permitting processes, a change in parking requirements, and a greater mix of housing types.
In 2016, 10,000 housing units were approved, predominantly for rental units. The county homeownership rate has the potential to sink to a historic low of 50 percent unless things change soon. Currently, it’s at 53.2 percent.
Vice President of the San Diego County Building Industry Association Matt Adams said, “There was a sea change in the issue with Gov. Brown finally acknowledging that the housing crisis is due to a housing shortage, and we’re not going to be able to subsidize our way out of it. We’ve got to build our way out of it.”