The Changing Tides of Carlsbad Real Estate
As a Carlsbad landlord, you're probably interested in developments in the San Diego County real estate market. Changes to local laws and regulations and trends in the market can affect your business in some interesting ways. We'll discuss a few recent developments in the North San Diego County and Carlsbad area which could impact your future property investment plans. We'll also discuss a couple of developments in the city of San Diego that could have a broader impact on the local market, as well as a couple of items specific to Carlsbad.
San Diego and Section 8 Housing
Over the summer of 2018, the San Diego City Council passed a ban on discrimination against sources of income. This change amends the city's fair housing ordinance by adding legal sources of income to the group of protected classes that have traditionally included race, gender, and religion. This move effectively bans landlords from considering sources of income as a factor when selecting tenants. Housing Choice Voucher (Section 8) recipients, who have often had to deal with many landlords who refused to accept vouchers for the program, will probably see the most significant impact. Be aware that this move applies to subsidies from other non-profit organizations as well. San Diego is now the tenth city in California to have made such a move.
While Carlsbad has not adopted such a measure, this move will still impact how renters make choices about where to live and can be a sign of things to come. Landlords in San Diego have expressed concern about the time required for the program to approve an apartment and the revenue that can be lost while that unit sits empty. The law created a $1 million fund to assist landlords who rent to voucher holders and incur property damage beyond the amount of a security deposit as a result.
Rent Control in San Diego
San Diego does not currently have a rent control ordinance. A bill presently with the state senate could have a significant impact on landlords in the San Diego rental market. If it passes, Assembly Bill 1482 will prevent landlords from increasing rents by more than 5% per year plus the rate of inflation. Some organizations are pushing for even stricter controls (some as low as 2% per year) and argue that the bill doesn't go far enough to help tenants. Many landlords are arguing that if it passes, the law will slow construction on new homes and lessen the economic incentive to invest in rental property. Regardless of your perspective, if it passes, expect the bill to have an impact on the San Diego County rental market once it goes into effect on January 1st, 2020.
Carlsbad's New HomeShare Program
The San Diego County rental market is not always affordable for some of the most vulnerable. The city of Carlsbad has partnered with an organization called "ElderHelp" to address some of these challenges. The city is launching a program known as "HomeShare," which is similar to other ElderHelp programs that have been active in San Diego and Poway for 25 years. HomeShare is intended to help both seniors who want to remain in their homes and younger adults in need of affordable housing.
The program matches partners through several compatibility methods and screens all applicants with a background check, reference check, in-home check, and interview. The program also includes a roommate mediation service. Seniors who are renting an apartment or other residence are eligible for the program and rent is left up to the homeowner or landlord's discretion. This program may not impact you at this point, but it may reflect some broader trends in your market. Depending on your target demographic, HomeShare may be something that you want to consider looking into down the road.
Carlsbad Beats out San Diego
San Diego is one of the most expensive large cities in the country when it comes to rental prices and price increases. In data from last year, rental prices in San Diego increased 5.5 percent over the previous year. San Diego's price growth had an impact on other cities in North San Diego County as well. For comparison, the year over year national average at this time frame was 2.5% with an average rent of $1,359. The study gathered data from cities with more than 100,000 inhabitants and rents charged in buildings with 50 or more units. While you may not be renting to tenants in a large apartment building, it's a useful indicator of regional trends.
Escondido saw an average rent of around $1,500, while Oceanside and Vista came in a little pricier at $1,690. These cities are some of the cheapest markets in North San Diego County. All of them saw rent price increases of 4.2 to 5 percent over last year. Carlsbad saw a 4.7 percent increase to $2,185 in average rent, which beats San Diego's average of $2,069—and makes Carlsbad one of the most expensive markets in the area.
A Property Manager Is a Partner—and Guide
It's an ever-changing world out there—you can never be too attentive to news and events that might impact your investments. A Carlsbad area property manager can help you to stay on top of such changes. Raintree Property Management is well-researched in local law, shifts in rental demographics, new trends in housing, and rental rate increases. We always have our eye on the market so that we can protect YOUR investment property!
As a landlord, you don't have to manage market research and legal maneuvering on your own to keep your property at the fore. Reach out to us online or by phone for a free consultation, and we can help you (and your property) stay ahead of the pack!
