San Diego Rents Approaching Record Highs: Surveys - NBC 7 San Diego

San Diego Rents Approaching Record Highs: Surveys

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    San Diego Rents Approaching Record Highs: Surveys

    NBC 7's Steven Luke has more on why rents are going up so much. (Published Wednesday, April 4, 2018)

    San Diego’s average rent may be approaching record highs, according to numbers from several national tracking companies.

    Rent Café, one of the companies that perform rent surveys, found the average rent in San Diego increased over the past year at about double the national average. The national average was two and a half percent, according to Rent Café, but renters signing new leases in San Diego are finding increases of four to seven percent compared to last year.

    "We're seeing higher demands, it seems to be, in the two bedroom bandwidth right now,” Christian Davis, the board president of the San Diego County Apartment Association told NBC 7. The organization guides landlords on how to properly run their rentals. “We've seen two bedroom rents grow, we've seen 3 bedroom rents grow, and demands on ones and studios ease up a little bit."

    Davis says San Diego's increases are all about supply and demand with the county being about 70,000 units shy of where we should be. Developers increasingly only want to build high-end units for better profit margins in the face of extremely high permitting fees.

    Another problem is that investors are increasingly looking to refurbish apartments, which leads to higher rent as they recoup costs.

    Edward Gomez rents in North Park. “Unless you move in with almost two or more roommates, it's almost impossible to still be able to have enough money for bills and every other part of life besides rent itself,” he said.

    Specifically, Rent Café’s surveys found rent increased in Carlsbad by 4.7 percent, in Chula Vista by 4.8 percent, in San Diego by 5.1 percent, in El Cajon by 5.4 percent and in Escondido by 6.6 percent.

    "Escondido is also going through a revitalization in that area so you're seeing a lot of the old industrial areas being redone and some new product coming in, albeit not huge apartment buildings, but 100 to 200 unit buildings delivered over the past few years,” Davis explained.

    As a result of high costs, more families are getting creative in living arrangements.

    Edward Gomez who’s 24, is unable to find a place he can afford, so he lives with his mother in North Park. "We have like a little outside separated property, and I just took up shack in there,” he explained.

    It’s important to keep in mind that survey results are affected by the amount of participation and the time of year it was taken. Many of the surveys only look at the rental prices for buildings with a large number of units – 25 or even 50 or more – and those surveys tend to yield higher dollar amounts that only apply to a portion of the marketplace.