8 ms·
San Diego rents declined following surge in supply
- nine_zeros 6mo ago[dead]
- dmitrygr 6mo agoIncrease in supply lowers equilibrium price? Somebody, pinch me!
- Detrytus 6mo ago[flagged]
- ivewonyoung 6mo agoA mainstream view on one side of the political spectrum that increase in new home supply(especially if high end) does not lower prices or reduce shortage. > One well-worn refrain of progressive urban politics is that new, “luxury” housing will not help solve the housing shortage. A 2024 study of U.S. voters found that 30 to 40 percent believed more housing would, instead, increase prices, and another 30 percent believed it would have no effect https://www.theatlantic.com/ideas/2026/02/housing-crisis-rich-poor-building/686086/ https://www.theatlantic.com/ideas/2026/02/housing-crisis-ric...
- mothballed 6mo agoYou can make $100-200k in 'easy' profit where I live by dropping the cheapest manufactured home on a plot. If you live in a place that allows it, I don't understand why people don't do it. I literally got a ~270k house for under $100k by being willing to be the guy the develops the plot. The actual house was laughably cheap, like 60k, there is a burnt out house dressed up in new paint selling next to me for like $300,000 and someone will snatch it up shortly.
- Detrytus 6mo agoWell, building luxury housing still helps, to some degree: the richest residents of the area would buy it, and they would sell their old house to someone slightly less rich, who in turn would sell their old house… At the end of this chain you get affordable housing.
- nemomarx 6mo agoI think the steelman argument is that maybe you induce demand and it's a wash on housing costs as rich people move into the city or etc to use the new condos But you do at least get more property taxes?
- ivewonyoung 6mo agoWell, that would mean the rich people moving in aren't hogging or bidding up existing housing stock in the city, and the cities they moved out of will have the same price lowering effect that the GP mentioned.
- theluketaylor 6mo agoThere is at least some truth to induced demand with new housing driving an influx of new residents, especially in cities with economic opportunity. Just like transportation induced demand, the solution is different style of infrastructure. High capacity metros, bus lanes, and regional rail to get people out of cars and use limited transportation corridors more efficiently than single occupancy vehicles. One more lane bro doesn’t work, but adding new forms of more efficient transportation does. New, denser housing with mid rise and high rise buildings and a mixture of unit sizes in walkable neighbourhoods with good transit access absorbs new residents and drives down housing costs for everyone. Single family sprawl doesn’t work, but density can. We have under-built for decades, so it’s easy to misunderstand the signals. More housing gets built and prices still go up, and many people are concluding more housing just increases prices, leading to people with good intentions decrying “luxury housing”. There are plenty of nimby actors in the mix too, tossing in all sorts of misinformation and bad faith arguments, muddying the water. The reality is areas with strong economic growth are all failing to add enough new housing and demand continues to outstrip supply, leading to higher prices. Many studies have shown even new high end housing helps manage prices, as someone rich enough upgrades, leaving their unit empty for someone else to upgrade into. That chain continues all the way down into the lower cost units, each time freeing up space someone else can afford. Large migration into a region can mess with how much prices can be affected, but studies still show even high priced new units do slow down growth in prices. Supply and demand does apply, we have just massively underestimated how far behind supply is for the demand and need to add so much more housing.
- skrtskrt 6mo agoThat's because "progressive" urban politics is generally not progressive at all and dominated by the upper middle those that benefit or think they benefits from squeezing the working class out of their neighborhoods.
- acdha 6mo agoThose people aren’t progressives: they’re NIMBYs who learned that certain language can make it easier to get the policies they want. We have a ton of them here in DC, and you can tell by seeing what else they support: they’ll talk about affordability to block luxury apartments, flip to pretending to be staunch environmentalists to block an affordable housing project, talk about traffic or “the poor” when protesting a bike lane before pivoting to block transit projects, etc. It seems incoherent until you look at it through the lens of whether something would add competition to their future home sale or cause the city to subsidize them driving every everywhere less.
- wallst07 6mo agoNo True Scotsman? They are progressive (Statistically)... it's just that they are human too. Meaning they can have progressive ideology and vote for weed, pronouns, but when you touch the wallet, not so much.
- fhdkweig 6mo agoThat part is the obvious part. I want to know how they got all the entrenched landowners to let new builds in their neighborhoods and drive down values. The NIMBYs are usually the problem.
- Detrytus 6mo agoWell, once you loosen up building codes to allow apartment buildings instead of single family homes then suddenly the developers will come with a lot of cash to buy those homes from NIMBYs. And cash is always convincing.
- mothballed 6mo agoMaybe renters were such a crazy high percent that despite the fact they were all wrapped up in their jobs and children vs retirees with nothing else to do in their $1M house than show up to meeting to influence the political apparatus they they still finally balanced out at the planning and zoning meetings.
- socalgal2 6mo agoplenty of renters ask for rent control instead of increasing supply. Often they make the mistake of seeing high prices for new apartments and mistakenly believe those high prices mean the rent is going up over all.
- skrtskrt 6mo agoCalifornia also passed a ton of laws that effectively upzoned the state in various ways. Minnesota did the same thing a few years back. This seems like the only real path - you cannot beat out these skeezy local homeowners and landlords at the corrupt local politics game. You need statewide politicians who have political ambitions to build off of solving these problems.
- crooked-v 6mo agoUnfortunately, it's not actually obvious. There are heaps of people, even and especially in the most expensive housing markets in the US, who will outright argue that supply and demand doesn't apply to housing.
- WarmWash 6mo ago[dead]
- superfrank 6mo agoExcept when it doesn't. From the same article, Seattle and Oakland had supply increase 13% and 6% respectively and both saw average rents go up. Long Beach, CA and Santa Ana, CA both had supply increase by over 10% and saw rents stay basically flat. More supply generally will help, but it's not a silver bullet.
- littlexsparkee 6mo agoMaybe more recently it's up but Oakland has been a supply success story as prices diverged with SF starting around 2021. There's a chart past the fold that illustrates it well: https://www.sfchronicle.com/realestate/article/oakland-rent-prices-decline-19458121.php https://www.sfchronicle.com/realestate/article/oakland-rent-...
- wallst07 6mo agoSo does decrease in demand! Pinch you again.
- exabrial 6mo agoIncredible. So what you're saying is... we should just build more housing? Who would have thought that was the answer?
- underlipton 6mo agoI see the "supply and demand" straw man is propped up well and often in this thread. Let's talk about the actual dynamics in play: 1) Rent-Fixing: This is widespread across the country and the actual reason why inventory increases often (commonly) do not lower prices. There are multiple tactics landlords have used to ratchet up rates without ever letting them drop. These include lease concessions that don't affect the base rent in lieu of rate drops in step with lowered demand, warehousing that artificially limits accessible supply even when new, physical units are hitting the market, and algorithmic price-fixing had allowed landlords within a region to stay in lock step without breaking rank lower. When landlords are able to use such tactics with impunity, they absolutely do warp supply-demand dynamics and allow rent rates to stay high even in the face of expanding actual inventory. For rents to decline, you have to break large landlords' ability to set their price. 2) Builder Subsidies: "Just build more and prices will drop," ignores that the incentive structures municipalities use to draw developers are an additional burden on residents. These for-profit corporations then seek to make a profit on their investment, leading to no direct meaningful inventory increase in the affordable unit range. Worse, developers often target existing affordable units for their redevelopment, destroying the very units that the new inventory is supposed to ultimately reduce demand for. In order for "build more" to drive down rents, it can't be done the way it has been, which mostly ends up being a giveaway to developers at the expense of the tax base and displaced renters. San Diego is a special case where it seems that the expanding inventory has been driven not by corporate developers, but by the construction of ADUs, which are built by homeowners out-of-pocket, are not tax-subsidized and, in fact, increase the taxable value of property. In this way, they work almost counter to traditional development, and these factors combine with their being created and operated outside of the control of corporate landlords means that they represent new and meaningful competition to those landlords. Thus, efficiencies are sought and prices drop. Encourage ADUs. Avoid subsidizing large developers and corporate landlords. If there is the political will, get the government directly involved in constructing subsidized owner-occupied, human-scale housing, as in Singapore and the pre-Thatcher UK. Relax zoning and build out public transit and car-free infrastructure in order to reduce the accessibility premium, as in Japan. That is how "build more" actually can work to lower rates.
- rossdavidh 6mo agoShould note that "top US markets" really means "most expensive US markets", not for example the largest by population.
- jupp0r 6mo agoIt's actually a combination of both, leaving out more expensive smaller markets.
- chao- 6mo agoI agree, comparing to other expensive markets seems a bit odd, rather than comparing to markets with some other similarity (population, geography, median income, et cetera). The full table in the original report is much more interesting: https://www.zumper.com/rent-research/national-rent-report https://www.zumper.com/rent-research/national-rent-report Many interesting comparisons to be made, especially places where rents fell YoY despite population growth.
- throwaway27448 6mo agoWhat is this country's allergy with public housing? Not pursuing that feels like jumping in water with our hands tied behind our backs
- mothballed 6mo agoThey were historically used, at least most notoriously, for selling crack and sniper fortresses for organized gangs. Your average American envisions something like Cabrini Green when you say public housing.
- throwaway27448 6mo ago[flagged]
- therobots927 6mo agoIt’s mostly driven by racism.
- antonvs 6mo ago> Wow are americans actually stupid enough to eat this bait? Yes. That “bait” has been raised to the level of propaganda that people, of some age groups at least (e.g. boomers) have been exposed to their whole lives. It doesn’t help that the US is quite geographically isolated, so most people never get much first-hand experience of anything else.
- throwaway27448 6mo agoI agree. But we also can't force people to expose themselves to the rest of the world. I fear it will take hardship to give people incentive to look elsewhere
- byigit 6mo agoBlack communities were bulldozed to make way for highways for being "slums" and forced into isolated "public" housing. This only concentrated the issued of crime and poverty and moved it out of sight of richer whiter communities. This was labeled as "Urban Renewal" and passed under the Housing Act of 1949.
- Apreche 6mo agoBut what about the desirability of San Diego? Was the decrease in rent only because of the increase in supply, or is there also lower demand?
- nemomarx 6mo agoVery off the cuff but I do see some news about shrinking population - https://www.reddit.com/r/sandiego/comments/1s71z3a/san_diego_loses_population_and_locals/ https://www.reddit.com/r/sandiego/comments/1s71z3a/san_diego...
- littlexsparkee 6mo agoThat says more about affordability than desirability since rents have gone up over the decade but there's been a steady trickle out to cheaper locales
- wallst07 6mo agoYou are reversing cause/effect though. SF rents have gone up, that didn't decrease demand. Why did SD rents drop, not because people left because it was too expensive, that doesn't make sense.
- littlexsparkee 6mo agoThat's not what I'm saying. While they dropped recently due to the supply surge, looking at the last decade SD rents had been climbing: https://www.costar.com/article/1297403833/san-diego-apartment-rent-growth-trends-at-record-high https://www.costar.com/article/1297403833/san-diego-apartmen... This suggests that San Diego has been getting more desirable over time (denser, more jobs, more culture, etc). The people who'd been around for some time that could hack the old SD rents couldn't deal with those rising costs and had been spilling over to Temecula, Phoenix, etc.
- quacked 6mo agoThe majority of the "more housing = cheaper rent" success stories crowed about on the internet correspond with net population exodus. Austin, Minneapolis, now San Diego. Edit: I think we should build several million more units of housing in the US. I'm salty because all the new housing I've seen is ugly shitboxes owned by national property firms that make everywhere feel like nowhere.
- abdullahkhalids 6mo agoLots of people quoting basic supply and demand. People in the year 1500 could pretty reliably tell you that a rock would fall down if you released it from a height. People would also tell you that if you threw it up and away, it would go up in an arc and fall down. The innovation that Newtown and friends brought about was they made quantitative predictions about the rate at which the rock would fall down, or the arc it would follow - both to pretty high level of accuracy. The point is that, of course, building more houses has a tendency to reduce rents. The question is whether reduction is -0.1% or -10% or there is an increase of +5% because some other factor was more dominant. It would be very hard for policy makers to argue against building more housing, if there was a quantitative model that predicted exact numbers for how much rent fell down given all relevant factors, and this model had been validated over and over again by prediction (not retrodiction). Rather than "rock fall down if you drop it" model that everyone keeps quoting.
- pastel8739 6mo agoNotably, though, a significant fraction of people seem to believe that building more housing will cause rents to increase. So it seems like it is still important to point to data suggesting the opposite.
- abdullahkhalids 6mo agoHousing is a unique market, because every single product in it is unique, and prices and rents can vary quite a bit. In a city I used to live, the city decided to revitalize a section of downtown by bringing down some old small buildings and replacing them with high rises. The resultant effect was a bloom in shops and restaurants in the area. That meant that 1km^2 area became a lot more attractive, landlords jacked up rents, and existing tenants in the other buildings in the area had to move out for people who were willing to pay 2x the rent. Of course rents probably went down elsewhere in the city to compensate. You will never get this sort of prediction from simply supply and demand. You need to build quantitative and holistic models that make predictions based on a range of factors. Then use those to make policy.
- epistasis 6mo ago
- thelastgallon 6mo agoAustin’s Surge of New Housing Construction Drove Down Rents: https://news.ycombinator.com/item?id=47433058 https://news.ycombinator.com/item?id=47433058
- thelastgallon 6mo ago> San Diego sits at the 11th most expensive rental market in the nation, according to the report, with the median rent for a 1-bedroom at $2,200. Median rent for 2-bedroom apartments is $2,950.
- bix6 6mo ago> San Francisco led the nation in annual rent growth this month, with both one and two-bedroom prices hitting new all-time highs, marking the highest levels in over a decade of Zumper data. One-bedroom rent climbed 18.4% to $3,790, surpassing its previous peak of $3,720 set in June 2019, while two-bedrooms rose 22.6% to $5,270, exceeding the prior high of $5,120 recorded in September 2025. From the Zumper report. 22% gain on SF 2B is just insane to me.
- umeshunni 6mo agoSan Francisco is notoriously the most anti-new-housing city in the country.
- bombcar 6mo agoFrisco (come at me) rent and housing prices have way more to do with the valuation of the latest startup darling than with much else.
- xtiansimon 6mo agoSF (only acceptable abbreviation) is 7x7 miles square surrounded by water on three sides—the only way to grow is up, right after you knock down the 100 yro Victorian homes and historic buildings, and gut the neighborhood charms. This from someone who once paid rent 1300/mo for a two bedroom in Potrero Hill.
- littlexsparkee 6mo agoNah, Frisco has a long history of use https://www.sfgate.com/local/article/rappers-poets-activists-say-frisco-17441731.php https://www.sfgate.com/local/article/rappers-poets-activists... as does 'the City'.
- xtiansimon 6mo agohehe. Frisco seems derisive to me. And The City? All major cities can be called that when in their vicinity (NYC?). But SF? It's right there on the Giant's caps!
- diogenescynic 6mo agoIt's always funny when people see the law of supply and demand in effect.
- energy123 6mo agoLandlords in San Diego were feeling less greedy this year. Same as lithium miners between 2022-2025. But SSD manufacturers and oil producers have been feeling really greedy this year.
- jmyeet 6mo agoSo the source for this (which is stated and linked in the article) is something called the Zumper National Rent Report [1]. For anyone curious, this is their methodology [2]. This seems to be a measure of active listings based on advertised prices. So it's not necessarily an indicator of if those listings close and at what price (eg in hot markets, people can offer above the listed price). But it seems reasonably well-regarded. I'm not sure where the "19 of 20" comes from because I grabbed the data from the report into a Google Sheet and sorted and it's not #19 by 1br Y/Y, 2br Y/Y or average rent. What it shows is 1br -5.6% and 2br -7.5% Y/Y. LA was -3.6%/-2.5%. It's hard to find a comparable city to this because there aren't actually a lot of coastal cities in the US that aren't mega-cities (eg Boston, New York, Miami, Houston). It seems like San Diego built ~4000 new housing units in 2025 with a population of ~1.4M. For comparison, Miami seems to have added ~18,000 but it's population also exceeds 6M so is that a fair comparison? My point here is that the direct evidence linking building new housing units to changes in rent is weak. Not that I'm opposed to building by any means but simply blindly building more units is by itself not an answer. It depends on what you build, where you build it and whether you allow effective or actual cartels to monopolize that supply. Take Manhattan as an extreme example. There has been a ton of building along so-called Billionaire's Row and also some pockets in the Financial District, West Chelsea, the UES and so on. A lot of this stock is the so-called ultra-luxury market. Prices for some of these new units are now exceeding $7000/sq ft. That is going to help absolutely nobody. Ultra-wealthy non-residents will park money there and that's it. This blind assumption that it will eventually become prole housing is ludicrous. Housing should primarily be for shelter, not a speculative asset or investment vehicle to get wealthy by denying someone else shelter. [1]: https://www.zumper.com/rent-research/national-rent-report https://www.zumper.com/rent-research/national-rent-report [2]: https://www.zumper.com/blog/our-methodology-empowering-the-renter-with-data/ https://www.zumper.com/blog/our-methodology-empowering-the-r...
- verteu 6mo agoRelevant metric is "New housing units per 1k existing" which is quite low in Manhattan. For some examples, go https://constructioncoverage.com/research/cities-investing-most-in-new-housing https://constructioncoverage.com/research/cities-investing-m... , look at metros that authorized many new units in 2023, and then look at inflation-adjusted home price change from 2023-2025. Like magic, you will find that post-inflation home value growth was low in the metros that built the most: Austin , Raleigh-Cary, Nashville, Jacksonville, Houston.
- Ancalagon 6mo agoI’m gonna also say this is because biotech is in decline and major employers are pulling out. People straight up can’t afford to live there on their own.
- underlipton 6mo agoI see the "supply and demand" straw man is propped up well and often in this thread. Let's talk about the actual dynamics in play: 1) Rent-Fixing: This is widespread across the country and the actual reason why inventory increases often (commonly) do not lower prices. There are multiple tactics landlords have used to ratchet up rates without ever letting them drop. These include lease concessions that don't affect the base rent in lieu of rate drops in step with lowered demand, warehousing that artificially limits accessible supply even when new, physical units are hitting the market, and algorithmic price-fixing had allowed landlords within a region to stay in lock step without breaking rank lower. When landlords are able to use such tactics with impunity, they absolutely do warp supply-demand dynamics and allow rent rates to stay high even in the face of expanding actual inventory. For rents to decline, you have to break large landlords' ability to set their price. 2) Builder Subsidies: "Just build more and prices will drop," ignores that the incentive structures municipalities use to draw developers are an additional burden on residents. These for-profit corporations then seek to make a profit on their investment, leading to no direct meaningful inventory increase in the affordable unit range. Worse, developers often target existing affordable units for their redevelopment, destroying the very units that the new inventory is supposed to ultimately reduce demand for. In order for "build more" to drive down rents, it can't be done the way it has been, which mostly ends up being a giveaway to developers at the expense of the tax base and displaced renters. San Diego is a special case where it seems that the expanding inventory has been driven not by corporate developers, but by the construction of ADUs, which are built by homeowners out-of-pocket, are not tax-subsidized and, in fact, increase the taxable value of property. In this way, they work almost counter to traditional development, and these factors combine with their being created and operated outside of the control of corporate landlords means that they represent new and meaningful competition to those landlords. Thus, efficiencies are sought and prices drop. Encourage ADUs. Avoid subsidizing large developers and corporate landlords. If there is the political will, get the government directly involved in constructing subsidized owner-occupied, human-scale housing, as in Singapore and the pre-Thatcher UK. Relax zoning and build out public transit and car-free infrastructure in order to reduce the accessibility premium, as in Japan. That is how "build more" actually can work to lower rates.
- waterTanuki 6mo agoI do wonder how much of this can be attributed to many people leaving biotech for better paying jobs in the AI gold rush (a.k.a packing it up and moving to SF). More housing is always a good thing though
- blendo 6mo ago"we've shown a pretty significant increase in the number of new housing permits each year, we’re closing in on the 10,000 mark for the last two years" Does that mean the "surge in supply" is really a surge in permits?
- fragmede 6mo agoFunny thing about permits...
- latchkey 6mo agoThis place sucks, don't come here. https://x.com/HotAisle/status/2046792071521157600 https://x.com/HotAisle/status/2046792071521157600 (taken tonight)
- culopatin 6mo agoI mean it’s just a sunset on some sand. You can get that all the way from Chile to Alaska, not a big deal.
- ButlerianJihad 6mo agoLet's be clear about our terms here. The articles in the OP appear to be strictly discussing the City of San Diego. The City of San Diego is a drop in the bucket compared to the expansive San Diego County. If you're talking about being a "border town" or "metropolis" then you're not talking about the City but the County. San Diego County includes La Jolla and points further north, as well as El Cajon and Jamul and all sorts of suburbs. It's a huge area with many disparate neighborhoods (and even 4 microclimates.) The City of San Diego includes very undesirable neighborhoods such as most of Downtown. There are a lot of places where normal people would have a terrible time, despite still being expensive. But there are also many different parts of the County which are "bad neighborhoods" and upscale places and ethnic enclaves, etc. Honestly, I was a little surprised that these articles are specifically referring to only the City in terms of housing supply. The vast majority of San Diegans don't even live in the city. I mean, it's not as pathological as Los Angeles and its county, but it's an important distinction that's often lost on out-of-towners.
- nextlsj 6mo ago[flagged]
- chasebank 6mo agoYou think "most people" save at least $75k a year?
- camel_Snake 6mo agoI think it's safe to assume that people close to retirement have existing appreciating assets contributing to that total savings amount.
- garbawarb 6mo agoSo low supply is good for the economy because it keeps people working.
- solatic 6mo agoQuite the opposite: retirees will flee to low cost of living areas, taking the money that they spend in other sectors (food, health, entertainment, etc.) elsewhere.
- insane_dreamer 6mo agoWho is saving > $50K/year (to make up that $600K)? Must be people who are already very well off.
- wnc3141 6mo agoFor expensive high growth markets, rents have dropped in most. Part of this is from a freezing of the labor market meaning nobody is really moving to town.