Tom York on Business: San Diego Needs 94000 More Homes to … – Times of San Diego
Times of San Diego
Local News and Opinion for San Diego
San Diego’s real estate sector is a never-ending source of fascinating insights.
The local market is suffering from a critical shortage of affordable housing options, a situation that reflects America’s affordability crisis, a new analysis shows.
The analysis was conducted by Zillow, one of the nation’s largest online residential brokers, based on data from 2021.
The analysis found that the San Diego region is missing 94,500 affordable housing units, with families doubling up in existing units, or going homelessness.
That’s an eye-popping number when you think about it.
But it’s not surprising because a typical low-income San Diego household would have to pay more than 76% of its income to take out a mortgage with a 10% down payment. Or the household could pay nearly 40% of its income to rent a typical apartment in the region.
Nationwide, some 4.3 million affordable homes are needed to house all of the families that are doubling up.
The mismatch between housing needs and available dwellings is playing out dramatically in the expensive coastal housing markets, like here in San Diego, as well as in Los Angeles, San Francisco and San Jose — as well as in Boston and New York on the East Coast.
The huge deficit in housing underscores the need for policies and investments that can boost construction, Zillow noted in a news release about the study.
“Construction productivity has been declining relative to the rest of the U.S. economy since the late 1960s, with land-use restrictions, building approval delays, and stunted construction sector growth all contributing to the need for more new home construction across the country,” according to the news release.
“Policymakers should explore ways to boost production and overall growth of the construction sector to ensure housing supply can catch up to demand.”
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Not all is doom and gloom in the world of residential real estate, however, especially when it comes to the rental market.
RentCafe’s June Rental Activity Report reveals important shifts in renters’ preferences in terms of where they live.
The report said San Diego’s “laid-back culture” attracted the highest number of new renters in California in June.
The report found that would-be renters in the West ranked San Diego No. 6, following behind Albuquerque, Portland, Denver and two suburbs of Phoenix.
Sacramento was the second most sought-after city for finding a place to rent in the Golden State, due to the lower cost of living there.
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San Diego’s Conrad Prebys Foundation has announced grants totaling $8.1 million to 18 local medical clinics as part of the SHARE — Strengthening Health Access, Resources and Excellence — Initiative.
Many of the clinics received $500,000 each.
“The initiative aims to ensure that excellent, culturally proficient healthcare is accessible to and in underserved communities,” according to a news release. “Grant recipients can use the funding in whatever way they think will be most effective for their organizations and the communities they serve.”
The medical facilities received funding to provide high-quality care to communities in areas with poor health outcomes and diverse populations, the foundation said in a news release.
The foundation is the largest private foundation in San Diego. The late Prebys was a billionaire who developed and rented apartments.
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OHM Fitness, a Scottsdale, AZ, franchise that hosts workouts using electro-muscle stimulation through wearable technology, is opening a location in San Marcos. Local entrepreneur Danielle Conklin bought the rights to the San Diego region and has plans to open 16 locations in the region.
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The parent company of San Diego-based meat alternative producer Planet Based Foods announced a $675,000 private placement recently.
Planet Based was founded in 2018 “with a mission to build a better food system by providing hemp-formulated superfood products to people today that support our planet tomorrow.”
The product uses hemp as part of its ingredients. According to a press release, the net proceeds of the offering will be used for general working capital and corporate purposes.
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Finally, this item of note in the realm of venture investing.
San Diego venture capital firm Correlation Ventures, which is unusual in the industry in that it uses predictive analysis to help make investment decisions, says it has closed its third fund, Correlation III, with $130 million raised.
Correlation is one of the most active venture firms in the industry, typically making about one new investment each week.
The firm says it can make investment decisions in under two weeks, which is lightspeed in the VC world.
The money raised for the new fund will be used to co-invest in private, U.S. companies promising to emerge as industry leaders, according to a news release
Correlation has a history of success, with several of its portfolio companies going public or being acquired by larger companies.
The firm has made about 400 deals since its start.
Tom York is a Carlsbad-based independent journalist who specializes in writing about business and the economy. If you have news tips you’d like to share, send them to tom.york@gmail.com.
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