Select Page

San Diego Home Construction Plunges. Biggest Drop In SoCal

San Diego Home Construction Plunges. Biggest Drop In SoCal

According to the Real Estate Research Council of Southern California, San Diego County built 43% fewer homes in 1H19 YoY, the most significant drop in all of Southern California (SoCal), an ominous sign that one of the hottest housing markets in the country is weakening. 

The softness in housing comes as San Diego officials are desperately trying to pass legislation that would be stimulative, reported The San Diego Union-Tribune.

There are other reports that the governor has endorsed a statewide rent cap bill, could further complicate the housing industry and lead to a further slowdown in building. 

Home construction in all of SoCal is down 25% YoY, mostly due to the slowdown in apartment building. 

Homebuilding was also down 40% in Santa Barbara County, 29% in Los Angele County, 20% in San Bernardino County, 9% in Riverside County and 7% in Orange County. Ventura County was the only region where homebuilding marginally increased. 

Borre Winckel, CEO of the local Building Industry Association, said, homebuilders, are under pressure at the moment, due to increasing regulations, high labor, and material costs, have dramatically increased the price of the build which is being passed onto buyers. These buyers have gone on strike this summer, not willing to buy homes in SoCal because of affordability issues – this has sent sales and prices tumbling in some regions.

Alan Nevin, an industry analyst at Xpera Group, said San Diego multifamily permits for apartments, townhomes, and condos crashed 50.1% in 1H19 YoY. 

Single-family homes in San Diego plunged 26.1% in 1H19 YoY. Nevin said the lack of land to build single-family homes is the main reason for the slowdown in building.

High prices in SoCal this summer led to some of the weakest sales in 5 years.

Sales slipped 6.9% in June MoM and were down 8% YoY, according to CoreLogic. That is the slowest June pace since 2014. 

Sales have been falling on a YoY basis for 11 straight months. Even though mortgage rates have plunged, buyers still aren’t showing up.

The SoCal housing market is stalling as a whole; record-high prices has led to an affordability crisis. The median price for SoCal homes sold in June increased to a record $541,250, up 1.2% YoY. That is the smallest increase since 2011, hints that years of rapid price growth could be coming to an end. 

Annual price gains in SoCal risk going negative as the overall West Coast housing market stalls. 

Last month, we detailed how a nationwide housing bust is underway with the first cracks showing up in Seattle-area home prices.

The price of a Seattle single-family home in May fell 1.2% YoY, the first negative change in a major US city in this cycle, according to new data from S&P CoreLogic Case-Shiller.

With home construction faltering in San Diego and the rest of SoCal, and, a significant slowdown in the overall housing market on the West Coast, this could be an ominous sign that a real estate downturn for the US could be nearing. 


Tyler Durden

Mon, 09/09/2019 – 23:05


This post has been republished with permission from a publicly-available RSS feed found on Zero Hedge. The views expressed by the original author(s) do not necessarily reflect the opinions or views of The Libertarian Hub, its owners or administrators. Any images included in the original article belong to and are the sole responsibility of the original author/website. The Libertarian Hub makes no claims of ownership of any imported photos/images and shall not be held liable for any unintended copyright infringement. Submit a DCMA takedown request.

Read the original article.

About The Author

Tyler Durden

Zero Hedge's mission is to widen the scope of financial, economic and political information available to the professional investing public, to skeptically examine and, where necessary, attack the flaccid institution that financial journalism has become, to liberate oppressed knowledge, to provide analysis uninhibited by political constraint and to facilitate information's unending quest for freedom. Visit https://www.zerohedge.com

Leave a reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Welcome

Bringing together a variety of news and information from some of today’s most important libertarian thought leaders. All feeds are checked and refreshed every hour and pages auto-refresh every 15 minutes. External images are deleted after 30 days.

Time since last refresh: 0 second

Publish Your Own Article

Follow The Libertarian Hub


Please consider donating using any of the cryptocurrencies below or use the Brave browser to tip using Basic Attention Tokens (BAT). Your anonymous contributions help keep this website running for everyone to enjoy!

Donate

Take Control of Your Domain Names
The Ultimate Managed Hosting Platform

Weekly Newsletter

Newsletter Signup

Subscribe to our newsletter to receive a weekly email report of the top five most popular articles on the Libertarian Hub!

Weekly Newsletter SignupTop 5 Stories of the Week

Subscribe to our newsletter to receive a weekly email report of the top five most popular articles on the Libertarian Hub!