Why is San Diego lagging so far behind in housing? Here are some reasons

San Diego’s building department is overwhelmed with permit applications and understaffed to meet demand, using archaic technology and unnecessary procedures to approve new homes.

Those are among the findings of a 22-page report that attempts to answer why the city is “so badly off pace” to meet its housing production goals.

A regional housing study projected that San Diego will need more than 13,500 homes each year to meet the needs of all income levels by the end of the decade. This year, the city only approved a third of the construction.

Three industry experts told inewsource that it can take the San Diego Department of Development Services anywhere from five months to a year to issue an automatic housing permit — a delay that can cost hundreds of thousands of dollars. As the city gives the green light to build, inflation rises in the cost of labor and supplies.

“With interest rates the way they are, it can make a project completely out of the realm of possibility,” said Jared Basler, a San Diego native who has been designing and permitting tiny houses in California for the past 10 years. in the past.

“It could be the difference between a part of a house being built or not.”

Released last month, the report details a number of barriers to homebuilding in San Diego and includes policy recommendations to overcome them. Recommendations include:

Among the challenges were the city’s planning and economic development departments, as well as the San Diego Housing Commission. But the city’s “one-stop shop” for building permits, development services, has presented many challenges to new homes. The report recommended modernizing the technology and completely overhauling the approval process to improve efficiency. Elyse Lowe, director of development services, told inewsource that she felt the report was mostly fair, but there were opportunities. It was good for the local council to see what she and her staff are up against – almost 100 vacancies in a department that receives 60,000 permit applications a year.

“This is a very difficult, intensive process,” Lowe said. “I wish it was quick and dirty, but the rules are tough and they continue to get tougher every year.”

The department has already begun trying to improve and streamline the permit process for workers and applicants, she said, and officials hope to fill 44 new positions dedicated to housing permits by January.

“We hear stories every day from developers and property owners about issues with the permitting process,” City Council President Sean Elo-Rivera said in a statement. “In the worst case scenario, we could unnecessarily delay the creation of affordable housing that a city and state so desperately needs.”

Elo-Rivera, along with council members Stephen Whitburn and Vivian Moreno, requested the analysis back in August to understand what is holding the city back.

Whitburn told inewsource in a statement that there is broad agreement that the city’s construction department is overstaffed, and he hopes to fill those new positions.

“When those new employees step up next year, we will have to evaluate the impact on permit processing times and determine what additional steps may be warranted,” Whitburn said.

Spokesman Moreno said the city council member is very busy talking about homelessness, one of the most important issues facing San Diego.

The news comes as San Diego’s housing crisis worsens. Half of the city’s properties are rentals and less than 1% are vacant, records show. The lack of supply has increased rents by 15% compared to last year, according to a study by the Rental Housing Association of Southern California.

“It’s the basic economy,” said Al Abdallah, chief operating officer of the San Diego Metropolitan Association. It is a non-profit advocacy group focused on housing.

“Until we build more supply, this is not going to get better,” Abdallah said. “We don’t have enough new development to keep up with the demand.”

‘Sheer volume and complexity’

One major challenge facing San Diego when it comes to building new housing is the lack of available land, the report said. Much of the city has already been built, so that the leaves are filled – or build on the unused property of the existing development. But that comes with rules.

“We have different ordinances in the city at any given time,” said Gary Geiler, deputy director of development services. “There can be four different types of rules that an architect has to design, or the staff has to review.”

The building department is responsible for enforcing all city laws and regulations, as well as those from many other agencies, including school districts, the state, federal wildlife agencies and the US Army Corps of Engineers.

“The sheer volume and complexity of the laws governing housing permits limit how quickly (development services) can complete its review and issuance of permits in accordance with regulatory requirements,” said the budget analyst’s report.

Depending on the size of the project, anywhere from one to 50 employees may be involved in one permit application. But the department is dealing with serious staffing challenges.

Almost a third of the positions related to permit applications are unfilled, nearly half of the department’s employees have less than five years of experience in the city, and one in five employees secure or close to retirement, the report said.

“When I started in 2014, everyone here had 25 years of experience. Those days are over,” said Lowe, the department’s director. , and that really affects our running time.”

Hiring and training have increased, Lowe said, with the department adding 100 new employees in the past year. But the department lost about 70 people in the same period.

However, the workload is getting heavier. Records show that employers are seeing a 10% increase in applications each year – from 59,000 in 2020 to 68,000 this year.

The city council has allocated funds to fill 80 positions in the construction department this fiscal year. Of the 44 new hires allocated housing permits from January, 30 will focus on reviewing applications, a spokesman said.

However, they don’t have the tools to effectively review these requests, according to the budget analyst report.

The department’s project tracking system, known as Accela, is seven years old and may not keep up with demand. In addition, San Diego is the only major city in the state that uses an online PDF document to manage its municipal code. That means that employees have to scan one PDF from another to keep up with changes in these tough housing laws. Every other major city uses a “code library” that allows quick search and reference all in one place.

The building department also has more than 750 application forms to fill out, some of which are outdated and duplicates, and 1,000 different fees. It all boils down to the process.

Employees have already begun to try to reduce the number of forms, and have hired a consultant to study and reduce the types of fees. That study should be ready for the city council early next year, Lowe said. Officials have also started a bid process to replace Accela, and hope the grant will cover the cost of the new code library.

Still, the report recommended extensive reforms to the approval process to reduce administrative burdens and improve efficiency. Council President Elo-Rivera told inewsource he will work with Mayor Todd Gloria and building department staff to see how the city council can help.

Lowe’s only disagreement with the report was the idea of ​​a strike. She said she had no evidence of that.

“Non-repetition means you have to do the same thing over and over again,” she said, adding that applicants do not always comply with requests and the process drags on when the project comes back to the workers incomplete. .

“We will not issue the permit until everything is checked,” Lowe added.

‘That’s a bad sign’

Permit applications can range from installing a water heater to building a high-rise. In general, there are two types of approvals: Ministry, projects that must be approved as long as they come up with standards, and voluntarily, projects that require analysis and analysis.

The report said it takes the building department two months, or 55 days, to issue a ministerial permit, while temporary permits take less than a year, or 330 days. But department officials said the averages don’t show the full picture, and provided records showing that more than half of all applicants receive approval in the same week.

“If the designer comes, knows the rules, and the reviewer points out what they need to do, it can be done quickly,” said Geiler, the deputy director.

Whitney Hill had a different experience. She is the founder of an Oceanside-based company that designs and builds accessory housing units, also known as granny flats. The city has tried for years to encourage the addition of small units like these to single-family homes in a push to increase the affordable housing stock, and Hill said her company has 20 projects in San Diego either working on permits or active construction. .

In many ways, Hill said, San Diego is leading the pack when it comes to granny flat development.

“Things that other cities are saying ‘No’ to, they’re saying ‘Yes’ to,” she said, such as building multiple units that fit into one lot.

These granny flat projects are considered ministries, along with other smaller projects that can be quickly approved. But, in her experience, instead of getting approval in the same week, or even two months, Hill presented data that shows her projects in San Diego take almost five months with the construction department.

When her company was ready to build, inflation raised the price by 20%, she said.

“That’s huge, tens of thousands of dollars for these projects,” Hill added. “For some people, it just makes it a deal breaker.”

To protect its customers, it had to make a business decision to freeze prices for six months.

It wasn’t always this way, said Luke Woolsey, an El Cajon-based construction company owner who has secured more than 100 San Diego home permits in his 24 years in business. He said it was expected to take two to four months to get approval.

But the disaster led to increased demand and labor shortages in all industries.

“Now, when we’re looking at the projects, it’s like, yeah, one was a year, that was 14 months, oh look, this one came out so fast, it was 10. That’s a bad sign,” he said. said.

“I see clients who get to the final stage of the approval process and say, ‘I can’t do my project.’

And for many, these permits cannot come soon enough. Woolsey said he has had clients who lost income and were forced to downsize to a granny flat and either rent out the primary home or combine properties. Another lost their home in a fire. But there is no channel to expedite approval in these cases.

“A lot of customers here need it,” Woolsey said, “and if we don’t figure out a way to do this in a uniform, organized way, I think we’re going to continue to fall behind.”

Will home prices drop in 2022 in Southern California?

In Southern California, median home prices aren’t growing in double digits anymore. That trend is over. After two years of housing growth, Southern California’s housing market is finally moderating. As expected, in October 2022, the median home price in Southern California decreased by 1.2% from September.


Is 2022 a good year to buy a house in California?

The bottom line here is that those planning to buy their first home in California in 2022 will face higher costs, compared to those who bought in the past 12 months. Looking forward, home prices in most California cities are expected to continue rising in 2022.

Will California home prices fall in 2023? It will decrease to reach 333,450 units sold, down from their sales volume of 359,220 this year, which is projected to be 19.2% less than the 444,520 homes sold in 2021. The median house price forecast is down. falling 8.8% to $758,600 next year after growing 5.7% this year to $831,460.

When can I buy a house in California 2022?

In California, you’ll find the largest number of homes listed in April, May, and June. You will usually have better luck negotiating property prices during these months when there are more homes on the market.

Is it smart to buy a house right now in 2022?

Our When to Buy a Home guide says yes – December 2022 is the best time to buy. Here’s why first-time buyers should jump back into the market: Mortgage rates made the biggest one-month drop since 14 years ago. There are few homes available for purchase in most US markets.

Is it better to buy a house in 2022 or 2023?

Home Prices Likely to Fall With interest rates rising in 2022, home sales have seen a sharp decline. Fannie Mae predicts that total home sales will reach 5.64 million in 2022, down 18.1% from 2021; by 2023, that number is expected to drop again to 4.47 million, a 20.7% decrease this year.

Will it be cheaper to buy a house in 2022?

Real Estate Market for the Third Quarter of 2022 And since there is still strong buyer demand and a shortage of homes for sale, prices are not going down. They are softening a bit when it comes to growthâ but they will still be bigger than they were at the beginning of this year.

Is 2022 a good year to buy a second home?

With rising mortgage interest rates and home prices, demand for second homes in 2022 is down in almost all metros compared to 2021 and pre-disaster demand levels but the market varies.

Is it a good time to buy property 2022?

Current market conditions The housing market is going through difficult times. Rents are rising, and it’s hard to find a home that isn’t out of your price range. While property prices are slowly falling, current interest rates are making it difficult to buy a home now.

Is it better to rent or buy in San Diego?

Metric/CitySan Diego, CAMarion, IN
Home Value$500,000$27,000
Time until Rent is Paid = Value18.123.75

Will rent prices ever drop in San Diego? Now, many markets in the United States are experiencing a downturn. Rents are down in San Diego County for the first time in years. The median price for a one-bedroom apartment in San Diego fell 4.6 percent to $2,500 a month, according to rental website Zumper, from September to October.

Is it a good time to buy a house in San Diego 2022?

Expect a Strong Sales Market On average, San Diego homes sell in just 11 days now! Additionally, the current median home price in San Diego is $811,000. This is an amazing 19.3% increase over last year! At prices like this, all signs point to an increase in housing in 2022.

Will home prices drop in San Diego 2022?

Mortgage rates are rising compared to last year. In October 2022, the 30-year fixed rate was 6.90% and in October 2021, it was 3.07%. Supply is still low and with all these factors considered, at this time, it is unlikely that the San Diego housing market will see any price declines in 2022 or 2023.

Will house prices go down in 2022 the Times?

A further rise is expected during 2022, which could seriously slow down the housing market because it means mortgage payments will increase. The cost of living problem is probably the biggest reason for the housing market downturn.

Is it smart to buy a house right now in 2022?

Don’t expect much relief in the form of lower rates in the coming months. Therefore, it certainly does not seem to be a good time to buy a home as prices have risen faster in 2022 than most industry analysts and economists had previously predicted.

Is now a good time to buy a home in San Diego?

Mortgage rates are rising compared to last year. In October 2022, the 30-year fixed rate was 6.90% and in October 2021, it was 3.07%. Supply is still low and with all these factors considered, at this time, it is unlikely that the San Diego housing market will see any price declines in 2022 or 2023.