61.4 F
San Diego
Thursday, Jan 26, 2023
-Advertisement-

SD Rental Rates Cool, Tracking National Trend

Apartment rental rates in San Diego County dropped heading into 2023, with the downturn in San Diego slightly steeper than the national average and the market is expected to remain cool in stark contrast to what had been rapidly escalating rates since the onset of the COVID-19 pandemic.

Rob Warnock
Senior Research Associate
Apartment List

“Like the rest of the country, San Diego has experienced a downturn in rents over the past several months,” said Rob Warnock, a senior research associate at Apartment List.

Nationally, rents fell 1 % from October to November, according to Apartment List, a national apartment listing service – the single largest monthly drop going back to 2017.

Rents in November fell in 93 of the 100 largest cities in the nation, Apartment List reported.

San Diego County rents dropped 1.4% month-over-month in November with predictions that the cooling trend is likely to continue.

Year-over-year rent growth in San Diego County was 6% toward the end of the year, compared to 19.8% a year ago, Warnock said.

“However, it does little to undo the rapid rent inflation that took place in the two years earlier,” Warnock said.

Quarter over quarter, San Diego County rents were down 3%, but since the start of the COVID-19 pandemic in March 20, they’ve risen 27%, according to Apartment List.

“We expect the market to remain cool going into the New Year, as interest rate hikes have dampened housing demand and inflation makes people more hesitant to move,” Warnock said.

Even so, Warnock added, “I believe we’re in this new wave of unaffordability insofar as a slow market in 2023 won’t undo much of the rent inflation that took place from 2020-2022, and that of course creates incentives for landlords to turn over their properties, at the expense of tenants who must absorb these massive rent hikes.”

Crystal Chen
Senior Manager
Zumper

Crystal Chen of Zumper, a listing service, said that San Diego ranked as the fifth most expensive rental market in the nation in December “with the prices of one and two bedrooms settling at medians of $2,500 and $3,200 respectively.”

“Notably, the price of two bedrooms in San Diego is up 15.9% since this time last year,” Chen said.

Within San Diego County, Encinitas ended 2022 with the highest monthly rent for a one-bedroom apartment at $2,680, according to Zumper.

The median rent statewide for a one-bedroom apartment was $2,076.

El Cajon, which consistently has had the lowest rents throughout the year, ended the year with the lowest rent in the county for a one-bedroom apartment at $1,750.

Rents grew the fastest in Vista, where they rose 28.4%, with the monthly rent for a one-bedroom apartment $2,260 in December.

“While we do expect rents to decrease across much of the country for at least the first quarter of 2023, consumer confidence will likely improve significantly by mid-2023 and renters will help drive the economy with more optimistic spending habits,” Chen said. “By the end of 2023, we’ll potentially see the first normal season since 2019.”

-Advertisement-

Featured Articles

-Advertisement-
-Advertisement-

Related Articles

-Advertisement-
-Advertisement-
-Advertisement-