04 Oct Report: Rental costs in San Diego on the rise
There were 1,743 reasons to buy a home for sale in San Diego last month. A leading apartment study found the average price of rentals in San Diego increased to $1,743 a month in the county in early September, increasing 8.4 percent in a year. The rise in rents is due in large part to the fact that the number of apartments for rent in San Diego is decreasing. The vacancy rate dropped to 2.17 percent — the lowest in five years.
The report tracked apartment units of more than 25 units and covers 131,287 apartments in San Diego County. The findings were released during Apartment Perspective 2017, an event sponsored by the San Diego Apartment Association and the Certified Commercial Investment Member Network.
San Diego rentals increase
San Diego is no stranger to rising rents. A study last month found San Diegans paid higher rent-to-income ratios for rentals than did residents of San Francisco and Silicon Valley, according to a new real estate report commissioned by the San Diego Regional Chamber of Commerce. It found renters in San Diego County spent approximately 35 percent of their income on rent as compared to roughly 29 percent for San Francisco residents. The report compared rents in 15 California counties with the highest incomes and rental prices in coastal communities in the state.
San Diego real estate has struggled with issues of affordability and growing demand amid a lack of new homes construction, including apartments. Now apartments are starting to feel the pinch. The number of new apartments available to rent could prove difficult to find. Just two new apartment projects were completed in the past six months, which added only 370 new units, but more are needed to meet the area’s housing shortage.
The report found rent increased 7.7 percent from March, when the average was $1,618 a month. Increasingly, rentals in San Diego are as much as mortgages. In early September, the average rent for a studio was $1,383; $1,533 for a one-bedroom; $1,821 for a two-bedroom; $2,257 for a three-bedroom; and $3,043 for a four-bedroom.
Those kind of prices have convinced many renters to become homeowners. The study found the highest rent is in North County, with an average of $2,152 a month, while the cheapest is $1,422 a month.