There's big news on the horizon for anyone interested in building a home in San Diego. Recent reports say that a surge of new construction is on the horizon for the area.
What's Coming in San Diego?
San Diego developers have been steadily pulling new housing permits this year. Experts say if their pace continues, they could pull more than 10,000 building permits, which is the most in over a decade. According to the Southern California Real Estate Research Council:
- Construction of residential housing, including townhomes, apartments, and single-family houses, was up 22% from the first quarter of 2020 to the first quarter of 2021.
- Developers received permits for 4,973 housing units in the first six months of 2021.
- Two-thirds of these permits were for attached homes.
- Most of the larger projects are in the Mission Valley and downtown areas.
- If that pace continues, the industry could break ground on more than 10,000 homes in a single year which has not happened since 2006, the year before the housing crash that precipitated the Great Recession.
Multi-family units (apartments and townhouses) are making up the bulk of new construction. The recent completion of 2,040 multi-family units is a 76% increase from last year’s same time period. Conversely, single-family home construction is down 32%.
What Does This Mean for Housing Prices?
Lori Pfeiler, CEO of the San Diego Building Industry Association, says that the current building structure encourages the completion of homes for higher-income buyers.
The average median price for a house in San Diego County is around $730,000, representing a yearly increase of 17.8%. However, Pfeiler hopes that house prices can get down to the $400,000-$600,000 range, which is much more affordable for middle-income families.
The good news is that housing prices are expected to stabilize over time, particularly following the inevitable increase in mortgage rates.
The San Diego area is growing in population and consistently adding jobs, so the demand for housing is strong. While an increase in new construction often leads to stabilization in prices as the supply comes in line with demand, this doesn’t seem to be the case in San Diego County.
The Design Appruv Advantage
Despite some of the challenges, there are great opportunities in today’s fast-moving and shifting market.
At Design Appruv, we’re experts in creating custom-designed homes, plus we take care of all of your drafting and building permit needs. We’re your one-stop-shop with architectural draftsmen, designers, and permit experts who’ll guide you every step of the way. We can also help you renovate and remodelan existing property to transform your space or help you with additions that expand your square footage.
If you have questions or have an idea already in mind, we’re here to help. Contact us today!