# Decisions, Projects, and Programs Shaping San Diego’s Housing Supply and Affordability: An Updated Overview
San Diego stands at a critical crossroads as it continues to grapple with a persistent housing affordability and supply crisis. While the city’s multifaceted strategy—encompassing legislative reforms, innovative development projects, land use policies, and community safety investments—remains robust, recent developments signal a dynamic and evolving landscape. From new legislation to community conflicts, and groundbreaking projects to fiscal debates, San Diego’s efforts reflect a city actively working toward sustainable growth, resilient communities, and equitable housing solutions.
## Accelerating Housing Production Through Legislative and Land-Use Reforms
San Diego’s push to streamline housing development has gained momentum with several key reforms:
- **AB-2525**, recently enacted, now **permits lands within Mission Bay Park to bypass certain surplus land restrictions**. This exemption facilitates **higher-density development** on publicly owned lands, supporting a diverse range of housing options while safeguarding environmental standards. The intent is to **expedite approval processes** and **maximize land use efficiency**, aligning with the city’s broader housing goals.
- The city continues to **update its Land Development Code**, promoting **higher-density, mixed-use projects** such as mid-rise buildings and adaptive reuse initiatives. These updates aim to **reduce bureaucratic hurdles**, **accelerate project approvals**, and **expand housing capacity** to meet San Diego’s growing population.
- **Heritage preservation reforms** are also progressing. Mayor Todd Gloria has proposed a comprehensive package to **balance preservation with development needs**, including **easing restrictions on adaptive reuse** and **modifying protections for historic sites**. This approach seeks to **transform historic structures into modern housing units**, preserving neighborhood character while increasing density.
### New Local Developments: Jamacha Housing Battle Post-Footnote 7 Repeal
A recent flashpoint surfaced in the southeastern neighborhood of Jamacha, where the **repeal of the controversial Footnote 7 zoning policy** has reignited community conflicts. Footnote 7, which previously limited certain types of residential development, was challenged and ultimately repealed after community protests and legal battles, as reported by the Voice & Viewpoint.
The repeal has **opened the door for increased housing density**, but it also **sparked fierce community response**. Residents are concerned about **neighborhood character, traffic congestion**, and **strain on infrastructure**. This conflict underscores the ongoing tension between the **need for more housing** and **preserving community identity**, emphasizing the importance of **thoughtful planning** and **robust community engagement** in shaping future policies.
## Major Projects and Creative Land Use Strategies
San Diego’s housing expansion is driven by both large-scale projects and innovative land use strategies:
- The **UCSD Pepper Canyon Mega-Village** project is on track, aiming to add approximately **6,000 student beds**. This development strives to **relieve on-campus housing shortages**, **reduce spillover pressures** on neighboring communities, and **address both student and workforce housing needs**.
- The **AVA Pacific Beach** project received approval for expansion, adding **138 new apartments**. It exemplifies the city’s support for **urban infill development** and **density-focused projects** in vibrant neighborhoods.
- To support essential workers, the city is developing **1,674 units for school staff**, including teachers and critical personnel. This initiative aims to **stabilize local education staffing** and **foster resilient communities**.
- Adaptive reuse projects continue to accelerate:
- A downtown hotel in Escondido is being converted into **32 affordable apartments**.
- Office-to-residential conversions are underway in transit-rich neighborhoods, transforming commercial spaces into **mid-rise housing** that **preserves neighborhood character** while increasing density.
- The private sector remains highly active, exemplified by the recent sale of a **seniors housing community for $47 million**, reflecting ongoing demand for **supportive and senior housing** markets.
### New Developments: Affordable Senior Housing Near Vista and Community Engagement
Adding to the momentum, an **affordable apartment complex for seniors** recently opened near Vista, providing much-needed supportive housing for older residents. This project underscores the city’s commitment to **addressing senior housing shortages** and fostering age-friendly communities.
Furthermore, residents are encouraged to **have a say in shaping the upcoming county budget**. A new initiative invites community members to **share their feedback and priorities** for the fiscal year starting July 1. A survey platform and engagement tools aim to **align county funding with local needs**, including housing, safety, and infrastructure projects.
## Funding, Market Interventions, and Affordability Strategies
San Diego employs a broad toolkit to combat persistent affordability challenges:
- The city secured **$1.67 million in state funds** dedicated to **veteran housing initiatives**, emphasizing support for vulnerable populations.
- The **reopening of the down-payment lottery** now offers **up to $150,000** to assist first-time homebuyers, aiming to **bridge the affordability gap** for many residents.
- Enforcement against **illegal house-flipping operations** has intensified, with recent actions targeting entities such as **California Dreamin’ Properties**. These efforts seek to **stabilize the market** and **protect residents** from exploitative practices.
- Policymakers are advancing proposals for **higher taxes on second homes and vacant properties**. A significant development is the upcoming **Empty Homes Tax**, scheduled for discussion at the **Rules Committee meeting on February 25**. If approved, this tax could **incentivize owners to rent or sell** unused units, thereby **improving housing availability**.
- The **FY27 budget hearings** are pivotal, as they will determine allocations for land reform initiatives, safety improvements, and infrastructure investments—crucial steps in enhancing San Diego’s capacity to implement effective housing and community safety programs.
## Market Trends and Short-Term Rental Impacts
Housing affordability remains a significant concern:
- Recent projections indicate **home prices will continue to rise into 2026**, reaching record highs despite increased construction activity. Although **home prices have shown some marginal relief** after years of rapid appreciation, the **market remains tight**.
- Only **about 1.6% of homes** are considered **affordable for the median household**, underscoring the depth of the crisis.
- Elevated mortgage rates, compared to pandemic lows, continue to restrict access for prospective buyers and widen disparities across neighborhoods.
The proliferation of **short-term rentals (STRs)** adds complexity to the housing landscape:
- A recent incident involved a **San Diegan homeowner** who received an eviction notice claiming the owners intended to move in, only to discover the property listed as an **Airbnb** afterward. Such cases highlight ongoing tensions between **property owners’ use of homes for STRs** and the **community’s need for long-term housing**.
- The city is actively working to **enforce regulations on STR platforms**, aiming to **balance tourism benefits with housing availability**.
## Infrastructure, Safety, and Community Resilience Investments
San Diego continues to prioritize infrastructure improvements and public safety:
- To **reduce traffic fatalities**, the city plans to **lower speed limits across over 679 miles of roads**, complemented by **pedestrian improvements** such as additional crosswalks and traffic calming measures—especially in busy neighborhoods like **San Ysidro**.
- The **Police Department** is undergoing modernization, with renovations to **Police Plaza** and the development of a **state-of-the-art police training center** at the former Chargers stadium site. Police leadership emphasizes **community engagement** and **responsiveness**, particularly in light of recent incidents.
- Climate resilience efforts include **Lake Hodges water releases** to mitigate flooding during heavy rains and a **$6.3 million settlement** paid to insurers for flood damages—measures that bolster the region’s capacity to adapt to climate impacts.
- Community safety concerns persist, exemplified by residents near **Lake Murray** demanding a **stop sign at a hazardous intersection**. Such localized efforts highlight the importance of **targeted traffic safety measures**.
- Urban projects like the **Gaslamp Promenade** face setbacks due to funding constraints, reflecting broader budgetary challenges impacting urban mobility and beautification.
## Fiscal and Legal Developments: Flood Settlement and Budget Outlook
A cornerstone recent development is the **San Diego City Council’s anticipated approval** of a **$6.3 million settlement** with insurance carriers over damages caused by the **2024 floods**. This settlement:
- Addresses the **financial repercussions** of severe flooding that damaged infrastructure and property across neighborhoods.
- Reinforces the city’s **commitment to climate resilience**, ensuring funds are available for **future flood prevention** and infrastructure upgrades.
- Demonstrates **proactive fiscal management**, providing resources to support ongoing safety and resilience projects amid climate challenges.
Meanwhile, the city faces a looming **$120 million budget deficit** for the upcoming fiscal year. In response, **community members and officials** are voicing their priorities:
- A recent survey indicates residents want the city to **prioritize affordable housing, infrastructure improvements**, and **public safety programs**.
- The upcoming **FY27 budget hearings** will be decisive in determining funding allocations. Potential budget cuts pose a risk to critical initiatives, including land reform, safety enhancements, and housing programs.
## Policy and Process: Heritage Preservation and Development Timeline
The **Heritage Preservation Program** received its **first comprehensive update in 25 years** during recent city council study sessions. The update aims to **modernize policies**, facilitate **adaptive reuse**, and **integrate preservation efforts into broader development goals**.
Simultaneously, **Land Development Code revisions** are progressing, with proposals scheduled for **public hearings and council votes** in the coming months. These revisions seek to **balance development needs with community input** and **align zoning policies with the city’s housing objectives**.
**Upcoming milestones include**:
- The **February 25 Rules Committee meeting**, where the **Empty Homes Tax** will be discussed—a potential pivotal step toward addressing housing inventory issues.
- The **FY27 budget hearings**, in late spring, which will shape the funding landscape for housing, safety, and resilience initiatives.
- The **mid-2026 city council votes** on land use reforms and heritage policies, which will decisively influence San Diego’s growth and preservation strategies.
## Current Status and Outlook
While the city demonstrates progress through project approvals, policy updates, and funding initiatives, the housing affordability crisis persists robustly:
- **Home prices are projected to continue rising**, and **affordable housing options remain critically limited**.
- **Community conflicts**, such as the Jamacha zoning debates, and **fiscal constraints** continue to challenge implementation efforts.
- **San Diego’s comprehensive approach**—combining legislative reforms, innovative projects, targeted funding, and safety investments—reflects a city committed to **building resilience and inclusivity**.
The **success of upcoming policy discussions and budget decisions** will be pivotal in translating strategic plans into tangible improvements in housing supply and affordability.
**In conclusion**, San Diego’s evolving landscape underscores an active city striving to balance growth with community needs. As new projects emerge, policies adapt, and investments flow, the coming months will be critical in determining whether these efforts translate into meaningful, lasting change for residents across the region.