Region sees uptick in new home construction, but still lagging

New homes are popping up all over San Diego County. Despite the pandemic crippling businesses and leaving millions unemployed, there were still just as many homes built in the region during the first nine months of this year as there were during the same period last year. Still, when compared to demand for new housing in San Diego, the pace of construction is lagging. Homebuilders in San Diego are expected to have completed between 9,500 to 10,000 new housing units this year, on par with 2019. But those numbers are still dreadfully behind the rate of construction seen in years before and a far car from the nearly 17,000 new homes built in 2004. In fact, San Diego experienced the biggest decline in new home construction in Southern California last year and appears unable to recover despite demand. The rising cost of land, labor and materials have hindered homebuilders’ ability to bring new residential units online. As a result, home prices in San Diego have skyrocketed as buyers compete for the few properties available. Meanwhile, conforming no-point 30-year fixed mortgage rates are averaging 2.875 percent and 15-year rates are near 2.375 percent. Do you have a question for Real Estate and Mortgage Analyst Mehran Aram? Submit your queries about a home purchase, refinance or reverse mortgage via aramco.biz, social media (#Aramcoreport), or over the phone at (866) 381–8888 and your question could be featured in an upcoming article.