According to an annual list of best and worst cities for renters by Forbes real estate research company, San Diego ranks the second worst city in the nation. Just behind Miami as the worst.
Marcus & Millichap calculated their results based on data collected from monthly rental costs in 2016, rent changes, and vacancies. Importantly the percentage of shared income that goes into paying for rent is a big factor. From 7NBC:
San Diego renters pay roughly $1,748 a month in rent, but about 30 percent of a household’s income goes straight to the landlord. The average apartment vacancy rate is a low 3.1 percent, and the year-to-year rent fluctuation is higher than most at 4.8 percent.
Forbes researchers say the influx of people to San Diego is no match for the low housing supply. With sunny San Diego an ideal weather location, the county already has a population of 3.3 million, and that number is expected to increase by a million within the next 30 years, according to the California Department of Finance.
According to Forbes:
Marcus & Millichap provided the data for the list. The brokerage and research firm tracks 46 large markets where they see investor demand. For each of those cities they compiled four key stats that went into our tally:
- Average monthly apartment rent in Q4 2016, net any concessions
- Change in apartment rent from Q4 2015 to Q4 2016
- Average apartment vacancy rate
- Apartment rent as share of average household income
Using this data, Forbes ranked the metro areas by each metric. We then came up with a composite score. Affordability—apartment rent as a share of household income—made up 40% of each area’s score. The other three metrics were equally weighted to make up the remaining 60%.
Also in the top 10 worst cities are Los Angeles, Orange County, Riverside-San Bernardino, Oakland, and Sacramento, with San Francisco among the top 15. (Click here for the ranking list – but if you have an ad-block, you won’t be admitted.)
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