The below article & video discusses how 2013 saw rent growth in San Diego top the levels for U.S. markets. Now almost five months into 2014, here’s to hoping the trend continues…
San Diego Apartment Market Emerges as a Top Performer in 2013 [Video]
San Diego’s apartment market has historically been reliably steady, but rarely a top performer in terms of rent growth. But in 2013, rent growth in San Diego topped the levels seen for the U.S. overall and for most other Southern California markets.
San Diego Performance Highlights Q4 2013
San Diego is one the nation’s more steady and reliable apartment markets; in good times it doesn’t post especially good revenue growth but in bad times it doesn’t post especially bad losses.
But at the end of 2013, San Diego is starting to see some pretty good momentum just as the U.S. average rent growth change has started to cool. As of Q4 2013, San Diego registered 3.6% rent growth while the U.S. apartment market as a whole registered 2.9%.
One of the driving factors for this growth has been a strong economy. In 2012, employment hit a decade high in the metro and while job numbers cooled slightly in 2013, the market experienced a 1.8% job expansion rate, good enough for second best in Southern California. San Diego is also the first Southern California market to return to pre-recession employment levels.
With solid rent growth and a strong economy, it’s no surprise to see occupancy performing well. As of Q4 2013, occupancy is at a healthy 96.4%, a level the metro has sustained for the past three years.
Despite the good news, there are two potential market factors that could change this momentum. One, the metro’s job growth has been primarily fueled by lower paying jobs, when traditionally limits rent growth; and two, construction is up to decade-high levels (a potential 1.9% expansion rate). But given these factors, MPF Research expects occupancy to hold steady in 2014 while rent growth cools slightly to 2.9%.
This article was originally posted by Property Management Insider and can viewed in its entirety HERE.