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August 11, 2010

SAN DIEGO COUNTY EXPERIENCING POPULATION GROWTH
In a recent report by the San Diego Association of Governments, it was projected that, in the coming twenty years, San Diego County will become home to more than 700,000 new residents. This is an increase of over 30,000 people yearly. Using these figures, it can be predicted that over ten thousand new households will be created each year.

This projection suggests that over ten thousand dwellings must be produced yearly in order to keep up with growth. During the last four years, the local production of housing was approximately five thousand units.

It will probably be very difficult to achieve the production of the needed ten thousand units. A more realistic figure for annual housing unit production would be around eight thousand per year. This would result in a shortage of about two thousand units each year or forty thousand units during the coming twenty years. In other words, we are very likely to experience a rather serious shortage of housing in the County.

At present, there is a dearth of land that is available for development. Most of the build-ready residential lots were used up during the wild times during 2005 and 2006. While we must prepare for the recovery of the housing market, very few of the larger developers have land that is improved and ready for building to begin.

The first quarter of this year has revealed that there has been a large drop in the number of available housing units when compared to the same period of 2008. The number of developments that are selling has dropped from approximately 302 to 115, and the number of new units that are available but not sold has dropped from approximately 3,360 to 1,075.

San Diego County builders report that, in spite of the present state of the economy, buyers are committing to buy at a quicker rate than in the past months. Particularly strong are the developments of single family homes that are in the $600,000 or higher price range in the coastal area of North San Diego County.

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