By Eric Law / September 23, 2025 
Everyone needs a place to live. We are bombarded with the idea that there are far too few houses, the available housing is very expensive, and we need to build a great deal more to drive prices down and availability up. Everyone agrees that housing affordability is a problem, even if they don’t agree on why.
But how much is enough? How many new dwellings do we need to build to get the housing market stable, where supply and demand reach an equilibrium?
The answer is surprisingly achievable and likely far less than the city, county and state assert.
Using data from the US Census Bureau’s 2024 American Community Survey and housing market measures from the economic analysis firm Moody’s, San Diego has a current shortfall of about 25,200 housing units. Using expected population growth figure from the state, San Diego needs to build about 42,600 units over the next decade to reach a housing market equilibrium on par with that across the remainder of the country.
While that may seem like a great deal of required building, it’s very achievable at a normal building pace. To place this requirement in context, San Diego issued over 9,000 residential building permits in 2023, many for multifamily dwellings with multiple units. This means that the city will reach a balanced housing market in 5 years at this building pace.
The reality is that the current building pace is unneeded and not likely sustainable. It is more likely that the city’s needs can support 2-3 years of high levels of construction, but as the market begins to balance, fewer developers will build in a tighter market. We can see this effect occurring now in the city’s rental market, as the glut of mid-market rental housing has stabilized rents and slowed new construction appreciably.
What’s not appreciated is that a 2035 balanced market would need more than 15,000 additional single-family homes than are currently in the inventory. The demand for single-family homes and home ownership is unabated and is particularly good for the economy. However, local building programs disincentivize single-family home creation and instead actively supports home replacement with apartments. This drives up home prices and places the lower rung of the housing ladder – starter homes – further out of reach for the younger generations.
The good news story is that we do not need Mayor Todd Gloria’s rash program of overbuilding with tens of thousands of expensive apartments. Gloria often cites the need for 108,000 additional housing units to be built. What he isn’t telling you is that figure comes from a pre-pandemic predicted population increase of 25% in 15 years and is based on exceptionally poor (and widely debunked) state forecasting. Instead, San Diego’s population contracted after COVID and is now expected to grow less than 3% in the next 10 years.
Why is this good news? Because homebuilding can catch up to the city’s needs at a pace and price point that better fits San Diegans and our bank balances. Lowering the pressure on the market will also stabilize land prices and reduce the speculative corporate home and land buying which also drives up housing prices.
The policy implications are clear: San Diego does not need the state or local building bonus density programs that remove single family homes from the housing stock and replace them with expensive apartments. We do not need ADU apartment buildings massed in your neighbor’s back yard or tiny, expensive studios crammed into six-story apartment buildings. We need consistent, deliberate, cost-effective development across all segments of the housing market.
It’s time to recalibrate our housing policy and programs to align with our city’s actual needs, not developer wants.
Eric Law is President of Protect Point Loma.
Yeah but our leaders don’t want equilibrium. They want massive growth to fix bad budgeting and to build out their dream of turning SD into Manhattan.
Meanwhile folks will cheer them on with the misguided belief that building will solve the affordability crisis instead of just fueling a never-ending growth spiral which, as one can see in other major metros, does not result in cheap apartments.
An extremely well written and researched article, Eric. You’ve laid out the facts very nicely and underscored what San Diego citizens have been calling for: More thoughtful, responsible planning that will result in the right type of housing needed rather than flooding the market with tiny apartments and intrusive ADUs that impact the safety and quality of life for existing residents. Mayor Gloria has gone about it all wrong.
The one glaring problem with the solution is that there is no more affordable, easy to build on property in landlocked San Diego. The Mira Mesa’s and Rancho Bernardo’s are all built out. The only thing left is go up and that simply decreases the supply of SFR’s proportionately. We can’t build our way out of the crisis. Everyone says it’s great with all the immigration we have had but you do realize that immigration puts pressure on low end housing which puts pressure on mid level housing, which puts pressure on high end housing. It’s not an easy fix. One question I do have is we live in a desert. Where is all the water and electricity for this rapid expansion going to come from when our “Governor” is restricting all forms of infrastructure?
Excellent article, Eric! Claiming we “need more housing” is like saying “we need more roads.” Well, where? How many? How wide? Good questions! Yet the housing “advocates” present this picture that more is better and all housing is good. They never provide the specifics that need to be included. Anyone advocating for more housing, including Todd Gloria, should have to answer the basic questions: how many, where are the right placements for them and for who is this serving? Living in the new storage facility boxes like in Hillcrest and Mission Hills or packing people into communities to the point they can’t evacuate safely like in Point Loma cannot be the way we define “more housing” as a success.
Fantastic article, thank you, Eric. I loved this paragraph, “What’s not appreciated is that a 2035 balanced market would need more than 15,000 additional single-family homes than are currently in the inventory. The demand for single-family homes and homeownership is unabated and is particularly good for the economy. However, local building programs disincentivize single-family home creation and instead actively supports home replacement with apartments. This drives up home prices and places the lower rung of the housing ladder – starter homes – further out of reach for the younger generations.” Todd Gloria’s plans are constructing a future of rentership for the majority of San Diego’s working class. You point out exactly why this is unnecessary and harmful.
“What he isn’t telling you is that figure comes from a pre-pandemic predicted population increase of 25% in 15 years and is based on exceptionally poor (and widely debunked) state forecasting.”
Agreed that the region’s housing story needs to be re-evaluated post-pandemic to reflect post-pandemic trends. I take issue with the lack of supporting citations and strong language used calling the state forecasting “exceptionally poor” and “widely debunked”. Would you like to add supporting information, citations, or clarification on what exactly this is in reference to?
TLDR: The state continues to use proven false population projections to mandate a building program unsupported by US Census Bureau-validated and verified data collection and analysis.
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California forecasts housing needs through it’s own set of demographic projections conducted by a statistical analysis unit within the state Department of Finance (DoF) (see https://dof.ca.gov/forecasting/). Those population projections form the foundation for the state housing mandate called the Regional Housing Needs Allocation (RHNA) created by the state Department of Housing and Community Development (HCD). This mandate is transferred from HCD to the city through regional associations of governments, in our case it’s SANDAG.
DoF uses a different — and divergent — statistical methodology than the US Census Bureau to create population estimates and projections. In 2019, this led DoF to provide HCD with population projections for San Diego that anticipated a 25% population growth through 2050, which diverged from Census forecasts. HCD used DoF’s gross overestimate to specify huge increases in housing building that each city had to account for within their Housing Element (https://www.sandiego.gov/sites/default/files/he_final_screen_view_june2021.pdf), a report to the state in which the city shows it’s plan to meet the state’s mandates over a specific decade. The current planning period is 2021-2029.
As you likely know, the 2020 decennial census confirmed — and annual updates support — both California and San Diego’s population growth is and will be minimal. DoF’s estimates and projections are demonstrably wrong. Accordingly, the state building mandates are grossly inflated and force policy requirements that are unnecessary and potentially harmful. The state Auditor highlighted this issue in a report in 2022 (https://information.auditor.ca.gov/reports/2021-125/index.html). There are a number of commentaries from elected officials and think tanks (see and example at https://embarcaderoinstitute.com/portfolio-items/double-counting-in-the-latest-housing-needs-assessment/) that highlight HCD’s malfeasance in forcing compliance to proven false demographic projections.
DoF issued updated projections in 2022 and in each subsequent year. HCD chose to ignore these facts and instead doubled down on the use of grossly inaccurate estimates. Both SANDAG and Gloria’s staff did not push back, largely because any correction would undermine the foundation for the overbuilding policies that are core to their political platforms.
Very well-stated. Thank you for your clear summary of the issues!
And, as a separate issue – when do we address the need to determine the population level that the area can afford, in terms of water resources, drainage issues, speed of growth of infrastructure to support the population increase?
Politicians that push through and quick action and simplified solutions to complex problems – and those that vote for them based on those promises… On the right and on the left. It can certainly cause pessimism for our democratic system.
Excellent article and comments, but it seems to me, when the Guv first mandated X amount of new housing, a few years ago, for the City of SD, it was about 25,000 units. And many communities of SD no longer look like SD with the ugly new multi storied, flat faced, flat top, depressing colors. The only community that doesn’t look like that is coincidentally, Hillcrest. They still have attractive new construction.
How many thousands of people have left CA, and if the City has a clue how many units called; granny flats, room additions, loft, ADU, ADUJ, artist studio, garage conversions, apts., artist studio, are just some of the descriptions I’ve seen on the City Permits applied for webpage, and determine a net increase of housing units, I’d like to know that number. It can’t be 25K year after year. But the City staff has not counted all the adjectives describing in plain english exactly how many Permits were issued for the same net, bottom line.