San Diego’s housing landscape continues to evolve as new rental data, state legislation, and local housing initiatives reshape the market. This week’s biggest stories all point to one trend: the region is adding more housing options while policymakers focus on long-term affordability.
Psst: to skip the scroll, click on the relevant news story, quicklinks below.
San Diego Apartment Vacancies Reach Highest Level in More Than 25 Years
San Diego County’s apartment vacancy rate climbed to 6.2% at the end of June, marking the highest level recorded in more than 25 years. While a higher vacancy rate may suggest a cooling rental market, the primary driver is a record wave of new apartment construction that has added thousands of units across the county in a relatively short period.
In 2025 alone, nearly 7,000 apartments were completed, with another 4,000 units still under construction. As these communities continue to lease up, renters have more choices than they have in years. Rather than making significant rent cuts, many property owners are competing by offering incentives such as free rent, discounted move-in costs, or complimentary parking to attract new tenants.
Affordability also remains a key factor. Although vacancy rates have increased, average asking rents have stayed relatively stable because many residents are still navigating higher living costs and slower wage growth. At the same time, thousands of newly completed income-restricted apartments have expanded housing options for qualifying residents, helping reduce demand for some market-rate units.
Key market highlights:
- Apartment vacancy rate reached 6.2%, the highest this century.
- Nearly 7,000 apartments were completed in 2025.
- Approximately 4,000 additional units remain under construction.
- Average asking rent is $2,583 per month, up just 0.5% year over year.
- Leasing incentives are becoming more common as apartment communities compete for renters.
Vacancy rates also vary considerably by neighborhood. Downtown San Diego and Mission Valley currently have the highest levels of available inventory, while coastal communities including La Jolla, Del Mar, Encinitas, and Solana Beach continue to experience comparatively tight rental markets.
For anyone watching San Diego housing trends, this is another sign that additional housing supply is beginning to influence the rental market, even if meaningful rent declines remain limited. You’ll also find helpful context in our previous blog here.
| Area | Avg. Monthly Rent | YoY Change | Vacancy Rate |
|---|---|---|---|
| North Shore CitiesDel Mar, Encinitas, Solana Beach | $3,654 | ▲ 2.8% | 3.8% |
| La Jolla / UTC | $3,348 | ▲ 3.1% | 3.2% |
| Central CoastPacific Beach, Mission Beach, Ocean Beach, Point Loma, Coronado | $2,471 | ▲ 0.7% | 5.0% |
| Chula Vista / Imperial Beach | $2,490 | ▲ 0.3% | 5.8% |
| North CountyOceanside, Carlsbad, Vista | $2,599 | ▲ 0.9% | 4.9% |
For anyone watching San Diego housing trends, this is another sign that additional housing supply is beginning to influence the rental market, even if meaningful rent declines remain limited. You’ll also find helpful context in our previous blog here.
SB 79 Expands Housing Opportunities Near San Diego Transit
California’s SB 79 officially took effect on July 1, creating new opportunities for higher-density housing near qualifying public transit stops throughout San Diego. The legislation is intended to support long-term housing production by allowing more homes to be built within walking distance of transit while reducing certain local zoning restrictions.
The law establishes different development standards based on how close a property is to a qualifying trolley station or high-frequency bus stop. Depending on the location, residential projects may be allowed at greater heights and densities than previously permitted. While the legislation is now in effect statewide, San Diego plans to implement many of these changes gradually over the next several years to allow for additional planning and public input.
| Distance from Transit | Max Density | Max Height |
|---|---|---|
| Within 200 feet | 140 units/acre | Up to 85 ft |
| 200 ft – ¼ mile | 100 units/acre | Up to 65 ft |
| ¼ mile – ½ mile | 80 units/acre | Up to 55 ft |
Communities including North Park, University Heights, Clairemont, University City, Mission Valley, National City, Chula Vista, La Mesa, Lemon Grove, Oceanside, and Vista are among the areas expected to see future development opportunities because of their proximity to transit.
Interactive Map · SANDAG ArcGIS
For buyers, sellers, and property owners, SB 79 represents a long-term planning change rather than an immediate transformation. Any redevelopment will occur over time as individual properties are proposed and approved.
San Diego Creates $8.5 Million Affordable Housing Preservation Fund
The San Diego City Council has approved a new $8.5 million Affordable Housing Preservation Fund, adding another tool to help maintain housing affordability across the city. Rather than focusing exclusively on building new affordable housing, the program is designed to preserve existing lower-cost housing before it transitions to market-rate pricing.
Preservation has become an increasingly important strategy as thousands of affordable homes are projected to lose affordability restrictions over the coming decades. In many cases, protecting existing housing can be completed more quickly and at a lower cost than developing entirely new communities.
Under the new program, nonprofit organizations and affordable housing developers can apply for funding to help acquire, rehabilitate, or preserve qualifying properties. The goal is to maintain long-term affordability while keeping more housing available for current and future residents.
The fund may support
- Preservation of naturally occurring affordable housing.
- Extension of affordability requirements for existing properties.
- Partnerships with nonprofit housing organizations.
- Long-term protection of deed-restricted housing.
- Projects that help prevent affordable units from converting to market-rate housing.
This initiative complements other housing efforts underway across San Diego, including increased residential construction and state policies encouraging additional housing near transit. Another initiative by the county with the goal of helping homebuyers is the recently launched dashboard for affordable housing, read more about it here.
What These Housing Updates Mean for San Diego
Taken together, these three developments show that San Diego’s housing market is becoming more balanced through multiple approaches.
New apartment construction is creating more rental choices, state legislation is opening additional opportunities for future housing near transit, and local leaders are investing in preserving existing affordable housing. While affordability challenges remain, these initiatives represent different strategies aimed at increasing housing availability across the region over the coming years.
If you’re curious about how these recent developments in San Diego may affect your current or future purchase or sale, schedule a Clarity Call with Heather.
