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San Diego rents are too high compared to San Francisco

By Strategist following x   2016 Aug 2, 5:13pm 1,319 views   1 comments   watch   sfw   quote     share    

While SD rents are high, it could be worse
Compared to wages, SD rent more than San Francisco

Mugshot of Phillip MolnarMugshot of Daniel WheatonBy Phillip Molnar and Daniel Wheaton | 6 a.m. Aug. 2, 2016
The downtown San Diego skyline and San Diego Bay before the Port of San Diego 2016 Big Bay Boom fireworks show on Monday.
The downtown San Diego skyline and San Diego Bay before the Port of San Diego 2016 Big Bay Boom fireworks show on Monday. San Diego Union-Tribune
Horror stories about rent in America’s Finest City might be bad, but there are worse tales throughout California.

San Diegans — as measured against a percentage of household income — paid more for rental housing than residents of San Francisco and even parts of Silicon Valley in the last few years, says a new report by London Group Realty Advisors that used the figure to illustrate a need for more housing.

But it’s not as expensive as Santa Barbara County, where the median rent devoured 48 percent of the median income of families who rented, or Santa Cruz County, where they paid 41 percent of median income on rent, said the most-recently available U.S. Census data from 2014.

Renters in San Diego and Orange counties shelled out about 35 percent of their incomes, whereas San Franciscans paid 29 percent and Mountain View renters, in the heart of Silicon Valley, paid 27 percent.

Employers said such high housing costs made it harder to recruit workers, said the London Group report, paid for by the San Diego Regional Chamber of Commerce.

“We’re competing for top talent for places outside California,” said Alison Phillips, chamber spokeswoman. “ . . . We’re looking at competitor cities like Austin, Denver or Boston.”

Housing is expected to be in short supply in San Diego for the foreseeable future because building is not keeping up with job growth, the London Group report said. The county is expected to add 460,462 jobs by 2050.

Even though San Diego County was not the worst off, the inability to find “reasonably priced” housing near work was the chief obstacle to recruiting and retaining workers, said a survey of 202 local employers from May 27 to June 2 by Wrentham, Mass.-based BW Research Partnership.

Real estate economists say that whenever people pay more than 30 percent of income on housing, the local economy suffers because households have less money to spend on other stuff, like food and consumer goods.

“That threshold can’t be higher for California because it just measures (money) you have left over after you pay housing,” said Alan Gin, economist at the University of San Diego.

Gin said local policymakers should take no comfort in knowing that renters are more distressed in Imperial County or other lower-income regions. Instead, they should focus on San Diego’s disadvantage to similar competitors, such as San Francisco and Santa Clara counties.

Gin also said that local policymakers should focus on how San Diego compares with counties with higher incomes. By this standard, the region looks expensive.

Of the 15 counties with the highest annual incomes, only Santa Barbara County (48.5 percent) was substantially higher than San Diego, which along with Orange and Marin had the median household spending roughly 35 percent of income on rent.

He said some inland counties have higher rent-to-income ratios simply because their economies are poorer. For instance, Imperial County renters made a median $22,590 a year in 2014 — $24,160 less than those in San Diego County.

There were 20 counties in California where renters paid more of their incomes than San Diego, including Imperial, Mendocino, Humboldt, Shasta, Los Angeles, San Bernardino and San Luis Obispo counties.

Rent Comparison of the 15 counties with the highest income

1   Strategist   ignore (3)   2016 Aug 2, 5:14pm   ↑ like (0)   ↓ dislike (0)   quote   flag        

Nuttboxer should be buying, not renting.

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