Axiometrics: San Diego Apartment Market Leads all of Southern California

Written by Apartment Management Magazine on . Posted in Blog

prod_site_miraDALLAS (AXIOMETRICS) – The San Diego apartment market is stronger than it has been in the past 14 years and, as of July 2015, has the highest rent growth in Southern California, according to Axiometrics, the leader in apartment and student housing research and analytics.

Annual effective rent growth in the San Diego-Carlsbad Metropolitan Statistical Area was 7.3% in July, the highest since Axiometrics began monthly annual reporting in April 2009. From the quarterly metrics before that, July’s rate was the highest since the 10.5% in the second quarter of 2001.

San Diego renters paid an average of $1,818 per month in July, $124 more than they did in July 2014.

“Southern California as a region had an apartment market that was slow to emerge from the Great Recession, and San Diego emerged more slowly than the Los Angeles-area metros,” said Stephanie McCleskey, Axiometrics Vice President of Research. “Job growth (2.8% in June) is slightly higher than LA, and not many new units are coming to market compared to the areas north on Interstate 5.”

  • The July rent-growth rate was the strongest in Southern California. The next highest was the Inland Empire at 7.2%. San Diego has the eighth-highest rent-growth rate in the nation in July, among Axiometrics’ top 50 markets based on number of units.
  • July’s effective-rent-growth rate was an 86-basis-point (bps) increase from June’s 6.3% and a 1274-bps rise from the 4.6% of July 2014.
  • s 95.3%, but 64 bps lower than the 96.3% in July 2014

San Diego’s apartment market strength is demonstrated by the fact that only one of the metro’s 14 submarkets with at least 1,000 units had annual effective rent growth of at least 5.0% in July, with six submarkets above 8.0%.

All except the bottom three submarkets saw rent growth increase from 1 to 8 percentage points in the past year.

The wide-ranging San Diego/Other submarket (All of San Diego County north of Oceanside and Vista and east of Escondido) had the highest rent growth, with the more compact, in-town La Jolla/University City following. The Clairemont/Linda Vista Mission submarket had both the lowest rent growth and the lowest occupancy. Since it also has the most units of any submarket (16.4% of the total San Diego market), it is a major factor in the metro’s overall fundamentals.

Annual submarket effective rent growth rates and July 2015 occupancy rates were:

 

Annual Effective Rent Growth

Occupancy

Submarket July-15 June-15      July-14

July-15

San Diego County/Other

10.2%

10.2%

1.9%

96.2%

La Jolla/University City

9.1%

8.2%

1.2%

93.6%

La Mesa/Spring Valley

9.1%

7.5%

6.8%

97.1%

National City/Chula Vista

9.1%

8.5%

5.1%

97.0%

Oceanside

8.3%

6.7%

4.8%

96.8%

Mira Mesa/Rancho Bernardo

8.0%

6.0%

5.1%

96.5%

Vista

7.5%

8.5%

6.4%

96.5%

San   Diego Metro

7.3%

6.3%

4.6%

95.6%

North Beaches

6.9%

6.4%

6.5%

95.0%

El Cajon/Santee/Lakeside

6.8%

6.8%

4.7%

97.5%

Downtown San Diego

6.7%

5.9%

1.5%

96.5%

Escondido/San Marcos

6.5%

6.9%

5.7%

96.7%

Ocean Beach/Point Loma Blvd.

5.9%

11.0%

8.3%

97.2%

San Diego/East of I-15

5.0%

4.1%

8.7%

95.8%

Clairemont/Linda Vista Mission

3.7%

1.2%

5.0%

93.7%

Source: Axiometrics Inc.


About Axiometrics

By Ross Coulter

Axiometrics’ specialty is monitoring the apartment and student housing markets, providing an in-depth view of volatile market trends. Axiometrics’ granular data-collection methods and enlightening analysis help clients make profitable – and intelligent – decisions. To learn more visit www.axiometrics.com, follow @Axiometrics or on LinkedIn, or call 214-953-2242.

 

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