San Diego Q3 Multifamily Market Insights: Vacancy dips to five-year low

Highlights:

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• Property performance in San Diego improved during the third quarter. Area vacancy continued to tighten, and asking rents inched higher in recent months. The pace of new development remains steady as developers attempt to match renter demand for units.
• Vacancy in San Diego dropped 40 basis points during the third quarter to 3.3 percent. Year over year, the rate is down 110 basis points.
• Area rents ticked higher during the last three months but at a slower pace than in previous periods. Average asking rents rose less than 1 percent during the third quarter to $2,285 per month. Year over year, rents are up 12.6 percent.
• The multifamily investment market slowed during the third quarter, while pricing remains above last year’s figure. The median sales price to this point in the year is $355,600 per unit, 10 percent higher than the median price in 2021. Cap rates averaged approximately 3.5 percent in both the second and third quarters.

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