San Diego Building and Housing Leaders Call for Regional Affordability, Capacity Building

News provided by

CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)

Aug 27, 2024, 12:30 ET

SAN DIEGO, Aug. 27, 2024 /PRNewswire/ -- San Diego region's housing supply challenges took center stage last week during the Center for California Real Estate's (CCRE) multi-sector solutions discussion highlighting the urgent need for increased affordable housing development.

Bringing together leaders from the Building Industry Association of San Diego County, City of San Diego, San Diego Housing Fund, and San Diego Housing Federation, the forum ― CCRE Presents – Navigating San Diego's Housing Opportunities: Collaborative Approaches, Practical Solutions ― explored solutions, policy strategies, and collaborative efforts to create a robust housing environment in the San Diego region. Watch the recording here.

Key among the insights shared during the discussion:

Expanding the missing middle- and low-income housing markets will help arrest San Diego's shrinking affordable housing supply. Over the past two decades, the city has lost two-thirds of its affordable housing, and addressing this crisis will require cities to build capacity and make continuous adjustments to meet growing demand.

"In the year 2000, we [San Diego] had about 90,000 homes that were affordable to a family at half of the median income. A decade later, we had 60,000. A decade later, we had 30,000," said Stephen Russell, president and CEO, San Diego Housing Federation. "It's a cascade effect. What we really need if we're going to solve this is a massive infusion of new for-sale housing that is attainable."

To manage the competitive market, "we fundamentally have to have this sense of urgency of getting through the process; we need to work together with the developers to get this done," stated Lori Holt Pfeiler, president & CEO, Building Industry Association of San Diego County.

Current land use constraints and zoning rules limit development goals to meet market demand and housing need. In San Diego, 80% of the land is zoned for single-family homes, and 20% is designated for multifamily development. To address the imbalance between supply and demand, more diversified housing, including accessory dwelling unit and multifamily projects, is essential.

"We need roughly 20,000 homes every year. Normally, we've been averaging a little over 5,000 homes permitted per year. In 2023, we saw almost 9,700, which was a really big jump, [but] still not enough," said Seth Litchney, City of San Diego Housing Policy program manager. "We need to be constantly looking for ways to adjust to market demands. We have the opportunity each year to assess whether we should make changes to our code that can help facilitate development and housing."

"Whether it is townhomes or smaller scale ― multifamily developments [medium density housing] ― is critical. Unless we're building more medium density, we're not going to be able to meet that middle income housing need," said Nicole White Forrest, executive director, San Diego Housing Fund.

"Homeownership is a significant driver for wealth generation for our communities. [By having] more housing that is more moderately priced and low income priced by diversifying typology and location, being smarter and more efficient, we can expand the opportunity to have household wealth grow."

The current housing market reveals a disconnect between producers and the diverse communities they serve. Capital investments should strive to reflect and benefit the communities they serve to create a better region. Creating greater access to pre-development capital and medium density housing opportunities can expand who is building, and what is built, locally.

"The producers of housing do not reflect the consumers of housing," said Nicole White Forrest. "If we look at gender inequality in terms of investors and developers, the last statistic I saw, was 19:1, men to women developers. In terms of racial composition, very similar inequality. It does not reflect the communities that we're building. There needs to be a reckoning in terms of how we enable the people who are here locally in terms of capital."

"If we are raking off half of all of our income, handing it to out-of-town investment funds, we are going to be less wealthy, less well off, and [have] fewer opportunities than if we kept it here," added Stephen Russell. "I don't think there's an immediate, direct impact on the housing market by those players, but there is a long and pernicious effect that we will see."

The Center for California Real Estate will hold its annual Housing Summit on October 30 in Los Angeles, featuring industry, academic, civic and private sector experts to discuss the regional and statewide housing trends, insights and solutions of the past year and explore the challenges and opportunities of the year ahead. For more information visit https://www.ccre.us/ccresummit.

About the Center for California Real Estate

The Center for California Real Estate (CCRE), an institute of the California Association of Realtors (C.A.R.), advances knowledge and research by collaborating with varied partners, spurs innovative thinking about key issues facing California and the real estate industry, and extends C.A.R.'s influence via intellectual engagement with different audiences, diverse stakeholders and new external partners.

CCRE serves as a nexus for multi-disciplinary thinking aimed at solving some of the state's most challenging issues. Bringing together key experts from a variety of fields — from academics and policymakers to industry leaders — CCRE produces new knowledge and serves as a key resource about housing issues for all C.A.R. members, external entities, the media and the public.

About the CALIFORNIA ASSOCIATION OF REALTORS®

Leading the way…® in California real estate for more than 118 years, the CALIFORNIA ASSOCIATION OF REALTORS^® (www.car.org) is one of the largest state trade organizations in the United States with nearly 200,000 members dedicated to the advancement of professionalism in real estate. C.A.R. is headquartered in Los Angeles.

SOURCE CALIFORNIA ASSOCIATION OF REALTORS® (C.A.R.)