02 Nov Rising rental prices could push more to become San Diego home buyers
It’s no secret San Diego rentals are among the highest in the nation. But how do the city’s rent prices compare with the rest of the nation? A study of the 50 largest cities in the U.S. found San Diego ranked 18th place for the highest rentals, according to Apartment List.
It found 55 percent of renters in San Diego spend a third or more of their income on rent, which qualifies them to be moderately or severely cost burdened. Financial experts suggest spending no more than 30 percent of income on rent. The Apartment List study was based on 2014 data. It found more than 25 percent of San Diegans spend half their income on rent. That’s compared to 66 percent of residents in Miami who spend half their income on rent or 42.5 percent of residents in San Francisco who pay a third of their income in rent.
Another study found San Diego is the worst major city in the country for building wealth due to rental and San Diego home prices, according to Bankrate.com. The area’s rental prices have the potential to hurt the local economy, as residents cut back on spending.
San Diego rental prices could spur more San Diego real estate purchases
But high rents could also push more people to buy a home for sale in San Diego. Rents increased 17 percent from 2007 to 2014, while income increased just 13 percent. It has been worst in the last seven years. In 2008 and 2011, 29 percent of renters were spending half their income rent.
San Diego rent increased by 17 percent from 2007 to 2014 whereas income increased by 13 percent, San Diego real estate experts said. But there may be more good new for cost-conscious renters who want to become owners.
The price of San Diego homes for sale fell slightly in October. CoreLogic Data reported the median home price in San Diego County was $460,000, down 1 percent from September. The prices of homes for sale in San Diego County have fallen since June 2015. In September, sales of single-family real estate in San Diego fell 14 percent compared to August.