A new study puts San Diego on the list of cities that are now so expensive, they’re now considered “impossibly unaffordable.” NBC 7’s Omari Fleming takes a look at how San Diego made the list.
It’s no secret San Diego is an expensive city to live in, but a new study from Chapman University puts America’s Finest City on the list of cities that are now so expensive that they're considered "impossibly unaffordable."
From New Hampshire to Temecula, Staci and Rob Porter have always owned their own home — until they moved to Solana Beach.
“You come out here, and you're like, 'What can you get for $350,000?' You can't get anything at all. It’s a little frustrating," Rob said.
For the past five years or so, they've rented a duplex in the coastal community where they've been aching and searching to buy a home. But with the surge in interest rates and soaring housing prices, the Porters are feeling a bit priced out.
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“We've never been close to the ocean. We've waited our entire life to do that, and Staci walks every day on the beach, and it's hard to give that away," Rob said.
The Porters are getting a taste of what the Chapman report lists as one of the top 10 most "impossibly unaffordable" cities in the world.
San Diego was one of four California cities that made the top 10 out of 94 cities studied.
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The report from researchers with Chapman's Center for Demographics and Policy and the Frontier Centre for Public Policy compares average income with average home prices to determine affordability. It found what has driven prices up is remote work during the pandemic, fueling the move to larger homes.
But the study says the biggest problem is land-use policies meant to limit urban sprawl and increase density. The study says they actually drive up prices because the policies constrict land available for housing.
"We've got Mexico to the south. We got the desert to the east, and we got Camp Pendleton to the north," Dr. Alan Gin, an economics professor at the University of San Diego, said.
The professor says the problem is likely exacerbated in San Diego because geography won't let residents sprawl much more.
"We can't build big tracks of housing like we used to be able to," Gin said. "We don't have enough housing being built to meet the growing population that we have, although we have experienced some out migration in recent years."
Gin also attributes the problem to corporate real estate syndicates buying up housing supply in recent years.
"You've got these big institutions with a lot of financial backing coming in and making big cash offers for housing," he said. "That's pricing out individual buyers, and that's ramping up then housing prices and also rents."
Those sky-high prices have the Porters considering other options, while still California dreaming.
“Yes,” Staci exclaimed when asked if she and her husband were considering leaving. Rob chuckled, “We always go back and forth.”
According to a report in March from the real estate website Zillow, San Diego families need an income of nearly $275,000 a year to afford a mortgage on a home, which is nearly double what it was before the pandemic.
