SAN DIEGO (KGTV) — San Diego has one of the lowest rates of homeownership among those under 30 nationwide, with only 1.7% of people in that age group paying a mortgage.
San Jose, New York, Los Angeles, Boston, and Sacramento were the only cities above San Diego on the list from Lending Tree.
52% of all San Diegans are homeowners but that is lower than the roughly 66% of American households that are homeowners, putting the city 4th nationwide, again behind San Jose, Los Angeles, and New York.
"The homes in San Diego are 127% higher than the national average,” Realtor Mary Zullo told ABC 10News. “The cost of living in San Diego is 40% higher than the national average so it's very, very difficult to get into a home."
San Diego City leaders are of course focusing on addressing homelessness and preserving affordable housing, as the housing crisis pushes more San Diegans out of their homes and onto the streets.
But part of the effort to ensure that affordable housing is available includes providing real opportunities for young people to become homeowners. Unfortunately, the City isn’t keeping up with its housing goals.
“Through rental assistance and creating more affordable rental housing, policymakers can help address homelessness,” the Urban Institute says. And, “By making homeownership more attainable, they can help free up space in the rental market.”
To help address this problem, the State of California is stepping in with a new law and a recently introduced bill that will help make it easier for everybody to buy a home.
Selling ADUs
In 2023, California passed a bill to allow the sale of ADUs, accessory dwelling units, separately from the larger home – if cities choose to opt in.
San Jose, which has the lowest homeownership rate in the nation, was the first California city to opt in to this program. Their ordinance to implement AB 1033 said the intent was to increase homeownership opportunities and bring more starter homes into the market.
While they haven't approved any sales yet, San Jose's planning department says they have received a few inquries.
“The City [of San Diego] Planning Department is reviewing the State's allowance of for-sale ADUs and is considering adopting a local program in the 2025 Land Development Code Update,” the department said in an email to ABC 10News.
“While we cannot determine how many additional ADUs may be built under this proposal, for-sale ADU homes can provide an additional pathway to homeownership opportunities.”
The city is currently reviewing its bonus ADU program that has been hailed statewide as a model for incentivizing the production of affordable homes.
According to Mayor Todd Gloria, the bonus ADU program has already resulted in hundreds of new homes, and close to half are income restricted.
Implementing AB 1033 would legalize the sale of these new, affordable homes.
Streamline SB 9
Senate Bill 9, passed in 2021, was a landmark housing law that was introduced by Toni Atkins from San Diego to let people build duplexes in neighborhoods where only single unit detached homes are legal.
The law also allows the division of residential lots to bring the total number of allowable homes to four where previously there was only one.
(When coupled with ADUs, this could mean lots of new homes in those neighborhoods.)
But certain provisions in the law have meant fewer people have used it than anticipated; Senate Bill 677 was recently introduced to amend this law to update some of those provisions.
A key update would eliminate the requirement that the applicant for the lot split sign an affidavit promising to live in one of the homes for three years.
This change will incentivize more landowners to use SB 9 to split their lot and build two, or four, new homes that can be offered for sale.
There’s of course still nothing saying the applicant *can’t* stay and live in one of the homes, but removing this requirement will make it more likely that lot splits happen, creating more opportunities for people to build starter homes.
The bill also removes an exemption for homeowners’ associations, 25% of California’s housing stock, according to the bill’s author Scott Wiener (D-San Francisco).
“SB 9 is a landmark law scaling back single-family zoning in California, by allowing for duplexes or fourplexes (via lot splits),” Sen. Wiener posted on Bluesky in a thread explaining the bill. “SB 9 can be a game changer if we make some improvements to it.”
State and local leaders agree, the road to more home ownership involves increasing opportunities to buy housing of all shapes and sizes.
While it could mean some changes to historically exclusive neighborhoods, the state and city are making an effort to let people build more affordable homes with these changes.
