Nevin is director of economic and market research at Xpera Group, the West Coast’s largest source of experts in construction and real estate.
Over the past few weeks, I have been clipping articles about Mission Valley and its development activities. The many new projects in the works could rival downtown San Diego’s. Obviously, not all these projects will come online simultaneously, but it is interesting to watch the projects as they unfold.
This month’s column focuses on the costs of developing market-rate rental apartments, and the rents and household incomes needed to justify their development. The summary data is from a more detailed analysis that I recently prepared for a client.
I have written recently in The Daily Transcript about the future housing supply of San Diego County. I concur with SANDAG’s estimates that 85 percent of the future housing to be built in this county will be multifamily, both rental apartments and condominiums.
My recent columns have focused on the aging of America and the types of housing that are available to the senior market. The basic fact of aging is that in San Diego County, 83 percent of the growth in the next 20 years will be folks who are 60 and older.
In last month’s commentary, I discussed the aging variances among the 50 states, noting that people in the Midwest and Northeast states are aging much faster than in the South and West.
When I look at the long-term demand for housing in San Diego County, I inevitably turn to the San Diego Association of Governments (SANDAG) population and household projections.
In recent months, many U.S. business magazines have run stories ballyhooing the Texas success story and, in particular, how that state is stealing business from California.
Much of our real estate consulting practice calls for focusing on small areas around Southern California. Most often, we concentrate on a project’s ZIP code, as virtually every ZIP code has a distinct demographic profile. Here I am focusing on 92103 — Bankers Hill, Hillcrest and Mission Hills, although a small part of Bankers Hill — below Laurel Street — is in 92101.
I have just returned from Boston where Little Italy is really Big Italy. Cannoli and gelato rule the day. The entire North End of Boston is inundated with great restaurants, great street scenes and real live Italians. I really don’t anticipate that we can ever emulate Boston’s Little Italy experience, but we can sure give it a try.
Things are going rather well for San Diego County. Last year, California added 250,000 people and San Diego accounted for 28,000, or 11 percent of that gain. Better yet, we were the second-highest county in the state in terms of population gain, second only to Los Angeles.
Most economic indicators in San Diego County are moving at an acceptable pace. Our population is growing. We gained 20,000 jobs in 2012 and it looks like we’ll do the same or better in 2013. Our sales tax revenue was up more than 7 percent (allowing our governments to function more smoothly) and car sales are booming. The only weak link is construction of for-sale housing. That’s still dragging along at 20 percent of the level of the early 2000s.
Insurance looms in my life. In the past few months, I have taken the time to chat with a number of professionals in the insurance and estate planning industries to learn more about how insurance can provide financial protection while we are alive and later for our heirs and heiresses. And, of course, I look at insurance from a real estate viewpoint.