Fjellestad of FBS in 92119 Quotes RE Experts to Emphasize Urgency & Necessity to become a Rental Owner in San Diego County

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Rents to jump over next five years
By Jonathan Horn


the next five years, rents in San Diego County are expected to rise
almost twice as fast as they did in the preceding decade, according to
projections by CBRE.

From 2004 to 2014, the average rent in San
Diego County rose from $1,242 to $1,542 per month, a 24 percent
increase. By 2019, the average rent is expected to hit $1,830 per month,
19 percent more than the current average, said Dixie Hall, a CBRE
apartment specialist.

“If we weren’t under supplied, we’d have
much higher vacancy and we wouldn’t be seeing the rent raises that we
are,” Hall said. “And we wouldn’t be seeing people paying $2,000 for a
one bedroom.”

Speaking to about 200 people at a panel held
Thursday by the San Diego County Apartment Association and the Certified
Commercial Investment Member San Diego chapter, Hall said demand for
rentals has increased because of three major factors: millenials are
moving out of their parents’ homes, previous homeowners now choose to
rent, and others still have credit issues from the Great Recession and
can’t qualify for a mortgage.

The vacancy rate in San Diego County
is about 3.7 percent, below a stable market, which would have vacancies
around 5 percent, said moderator Robert Vallera, senior vice president
of VOIT real-estate services. Another report, released Thursday by
Cassidy Turley, calculated San Diego County’s vacancy rate as 2.6
percent, second lowest in the nation after San Jose.

CBRE reports
that it is tracking 8,600 new units under construction, with 1,600 of
them downtown. That’s where most of the demand for new units exists,
said Peter Burley, who directs the Rosenthal Center for Real Estate
Studies of Chicago.

“The millenials are distinctly urban,
preferring public transportation, walkable neighborhoods, flexible work
environments and easy access to social interaction,” he said. “They
don’t drive.”

Hall said the new units being built, while
expensive, are highly amenitized, with fire pits, pool decks, barbecues,
large gyms and clubhouses. “You would want to live in these
properties,” she said. “Residents today want to socialize, they want to
be outside, they don’t want to be trapped in their apartment.”

Sessa, senior vice president of Sudberry Properties, in charge of the
expansive Civita mixed-use community in Mission Valley, said developers
have a hard time responding to the demand for more units.

almost impossible to get things approved and it takes a very long time,”
he said. “Unfortunately even with the amount of deliveries that are
expected in the next few years, it is by far the demand exceeds the
supply, not because we don’t want to build it but because it’s very
difficult to get those projects actually out of the ground.”

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