A huge shift in the San Diego County housing market took place following the economic downturn and housing market debacle in 2007. Since that time, there has been tremendous growth of the single-family rental market, with this segment of the housing market developing quickly as an investment and income opportunity. According to the Washington, D.C.-based research group Urban Institute, most of the increase in the housing demand in recent years has been filled by rental units.
Figure 1 to the left shows the steady rise in San Diego County median rent rates of 3 bedroom properties since 2012 (both multifamily dwellings such as apartment complexes and single-family homes). The increase in rent rates across our county has been about 35% in just six years! A reason for much of this change are new attitudes of a younger workforce and social demographics desiring more flexibility and mobility. Seniors seem to be cashing out of the market and downsizing following the downturn and millennials seem to be waiting longer to get married, settle into permanent housing, and start families. At the same time, other significant barriers to home ownership also exist to make renting a more practical option. While the job market is now hot in San Diego County, earnings of young professionals have not kept pace with increasing home sale prices. Many young professionals are also strapped with student loan debt and tight lending practices make it more difficult to qualify for a home loan.
Not only are rent rates climbing in San Diego County but the overall vacancy rates and average days on market for rental properties are at an all-time low. Figure 2 shows the average days on market of available rental properties and the overall vacancy rate in San Diego County between April 2017 through March of 2018.
What does this mean for you if you are considering renting your home in San Diego County? The current real estate market dynamics create a once in a lifetime opportunity for individual homeowners and investors alike to hold properties for capital appreciation while earning high returns on rental income. If you would like a consultation from North County Property Group regarding your home value and the process for renting, do not hesitate to contact by clicking through to Get a Free Quote (click here) on our website! We look forward to hearing from you!