San Diego County built fewer homes in 2022 than it did the previous year despite a major political push for more housing.

There were 9,642 homes built last year, said data from the Construction Industry Board, compared to 10,163 in 2021. The vast majority — 6,171 — were multi-family, mainly apartments, as well as some townhouses and condos.

Increasing housing supply has been a major focus of Gov. Gavin Newsom, as well as the city of San Diego and the county. So far, it appears to hardly be making a dent.

“It’s frustrating to us,” said Lori Holt Pfeiler, CEO of the San Diego County Building Industry Association. “There are so many comments from elected officials that we’re in a housing crisis, and trying to come up with policies that get housing built, and here we are with fewer homes.”

She said a frustration for builders is the amount of time it takes for cities to approve housing projects, a process that can take months — or even years — for various approvals. Pfeiler said there has been movement from some cities to speed up the process, which often involves separate approvals for stormwater plans, structural elements, landscaping and everything that goes into a project.

The association estimates the region needs to build more than 21,000 homes a year to make up for shortfalls. The last time it came close to that total was 18,314 in 2003. There was a major drop off in the Great Recession, with under 3,000 homes built in 2009, and it took a long time for the building industry to pick up steam again.

Amid explosive rent and home price growth, 10,163 homes were built in 2021 — the highest in 15 years.

The city of San Diego built the majority of the housing, 4,401 housing units, or 46 percent of everything built in the county. Other big building spots were unincorporated San Diego County with 1,667 units (17 percent), Chula Vista with 979 (10 percent), San Marcos with 562 (6 percent) and Oceanside with 549 (6 percent).

The lowest amount of homes built was 15 in Del Mar and 16 in Solana Beach. Other smaller totals were in La Mesa (82), Coronado (54), El Cajon (54), Imperial Beach (30) and National City (23).

Gary London, San Diego housing analyst, said the situation in coastal cities is much different than, for example, National City and La Mesa. He said both those cities are welcoming to builders, but many developers have decided they can get a bigger bang for their buck in other areas.

“Mostly it has to do with perception of a marketplace,” he said. “The cost of construction doesn’t always align with the rents they can get in National City, but it does align with rents they can get in more upscale markets like North Park.”

London said it is likely markets like National City will see more developer interest in the future, especially with building constraints in other places. He said Solana Beach and Del Mar are land constrained, but that doesn’t tell the whole story when increased density could make a difference.

“There is a resistance on the part of the community and their policymakers to entitle new housing projects,” London said.

San Diego County was not the only area that experienced a building slowdown in recent months, said Zillow chief economist Skylar Olsen.

Zillow national data shows single-family building permits were up 27.4 percent in a year as of January 2021 as the hot market was nearing its peak. Yet permits have seen a big drop over the last six months as rising interest rates have made the market for new homes drop.

Olsen said many developers may have projects ready to go but aren’t in a rush to get them done if they think the demand won’t be there.

“Higher mortgage rates decimated buyer affordability,” she said, “and builder confidence plummeted.”

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San Diego County home building by area
Annual totals and percentage of total built

San Diego: 4,401 (46 percent)

Unincorporated San Diego County: 1,667 (17 percent)

Chula Vista: 979 (10 percent)

San Marcos: 562 (6 percent)

Oceanside: 549 (6 percent)

Escondido: 254 (3 percent)

Poway: 231 (2 percent)

Santee: 168 (2 percent)

Vista: 163 (2 percent)

Lemon Grove: 153 (2 percent)

Encinitas: 146 (2 percent)

Carlsbad: 95 (1 percent)

La Mesa: 82 (1 percent)

Coronado: 54 (1 percent)

El Cajon: 54 (1 percent)

Imperial Beach: 30 (0 percent)

National City: 23 (0 percent)

Solana Beach: 16 (0 percent)

Del Mar: 15 (0 percent)

Source: SDuniontribune by Phillip Molnar