In North Park, Jake Hueras has an apartment that costs $2,100 a month. It’s a one bedroom, one bath, and 650 square-foot place that he shares with his girlfriend. He’s boosted the debt on his credit card and he’s canceled his health insurance to help make ends meet. He was forced out of another apartment in Normal Heights and his new place is smaller and more expensive.
“About a hundred dollars more,” Hueras said. “We lost a bedroom and a bathroom. A hundred square feet. But it was the only place that had the criteria we needed.”
The cost of homes in San Diego is the highest it has ever been. A survey by the Texas home-buying website OJO Labs has called San Diego the least affordable metro area in the U.S. And people like Jake Hueras are seeing it firsthand.
His story is typical in a San Diego market where rents have increased 19% over the past year, according to apartment listing web site Apartment List. In 2020, some markets, like San Francisco, saw rents decrease with the pandemic. In San Diego, they just kept rising.
Jan Neff-Sinclair rents an apartment for $2,800 dollars a month in Carlsbad. Like Hueras, she was recently forced out of another apartment when the building was sold. She can pay for her new place on her disability income, thanks to her roommate’s Section 8 voucher. But it’s hard for her to know how long that’ll last.
“It’s affordable now,” Neff-Sinclair said. “If they raise the rent again in October, it probably won’t be, unless social security goes up a lot — or the housing voucher goes up a lot.”
As rents surge upward, mortgages are doing the same. The San Diego Association of Realtors reports the median sales price for a detached, single family home in San Diego was $1 million in April. Just like the rental market, that’s up 19% from a year before.
Political pressures and a dwindling supply of buildable land have long prevented San Diego from keeping up with the demand for new housing, according to Alan Gin, an economics professor at University of San Diego.
Today’s rising home prices are fueling speculation, he said, as investors make cash offers for homes in hopes of selling them for a profit. And something else happened over the course of the COVID-19 pandemic — Gin calls it the pandemic piggy bank.
“During the pandemic, a lot of people were able to keep working. They were still drawing in a lot of income, but they didn’t have anywhere to spend it,” Gin said. “So people built up a reserve of cash. Once the pandemic ended, or once things started …….