State-mandated study finds it's tough to be a renter in Encinitas

The population in Encinitas is trending older, wealthier and more likely to be retirees, and renters are finding it increasingly difficult to stay in town, a new study of housing conditions finds.

Among other things, the study produced by the consulting company Beacon Economics of Los Angeles concludes that:

• The high cost of housing is the primary reason people move out of Encinitas.
• More than 50 percent of the people who rent in Encinitas are considered “rent burdened,” meaning they pay more than 30 percent of their income on rent, and they’re in this position because not enough new housing is being built.
• The median income of people moving into Encinitas tends to be higher than the income level of the people leaving. And, the new arrivals are older — on average three years older — than the people leaving.
• And, the city’s programs and policies don’t do enough to address the high cost of living issues that the city’s lower-income residents face. The city could improve this situation by doing everything from allowing more housing construction to taxing people with vacant homes, it concludes.

To produce this state-mandated, “Displacement Risk Analysis” study, the consultants reviewed demographic data, migration patterns and housing market trends. They also analyzed population growth, household income statistics and rental rates, among other things.

It’s worth noting that “a lot of coastal cities are facing the same dynamics,” Stafford Nichols, a research manager with Beacon Economics consulting company, told the Encinitas City Council as he gave an overview of the study results last week.

After hearing his presentation, Encinitas City Council members said they agreed with some of the study’s conclusions, but disputed others.

Councilmember Bruce Ehlers, whose district includes Olivenhain and part of New Encinitas, said he questioned a number of items, including the study’s information on vacancy rate. The study found that the number of unoccupied homes — typically, places being used as vacation homes by wealthy owners who live elsewhere — had doubled from 4.3 percent in 2000 to 8.6 percent in 2020. Ehlers said he thought that might be skewed by the pandemic when people were buying homes with cash and relocating to new places to work.

He also strongly objected to what he said was the study’s characterization of Proposition A, the city’s growth-control initiative that he helped craft. Ehlers said the study made it sound like Prop. A stopped new housing construction and the data actually shows new housing has increased since its passage in 2013.

Nichols said Ehlers was right about what the data showed, but wrong to say that the study blamed Prop. A for the city’s current housing situation. He said the study simply mentioned the ballot measure in timelines and other materials; it didn’t declare that Prop. A prevented new housing construction. Council members ultimately directed Nichols to remove the mentions of Prop. A from the company’s final report.

Councilmember Joy Lyndes said she disagreed with the study’s conclusion that Encinitas should increase the amount of market-rate housing in order to help lower-income people who are having trouble renting. The study declared that having more housing generally available would reduce rental rates for everyone.

“I would rather focus on who’s vulnerable here in our community .. and then really target our solutions and recommendations … to helping those citizens,” she said, mentioning that she wanted to promote projects that are set aside for low-income people.

Lyndes also said she had had suspicions that her district, which covers the Cardiff region, had a high displacement rate, but it was surprising to see how it compared to other parts of town. The study’s list of places where people were most likely to end up losing their housing due to economic issues included downtown Cardiff, the neighborhood around Ada Harris Park, the area between Encinitas Boulevard and Santa Fe Drive west of Balour Drive, and the neighborhoods between Leucadia Boulevard and Encinitas Boulevard from El Camino Real to Saxony Road.

Councilmember Allison Blackwell, who represents the city’s Leucadia region, said she wanted more information about the number of short-term rentals listed in the study, given that its figure was about double what the city has on file. Nichols said his company paid for data from AirDNA, which tracks vacation rental information around the world via advertising listings and other sources. He said he’d be “happy to share” his information, so they could compare it against the city’s list.

Councilmember Kellie Hinze, who represents the city’s Old Encinitas region and is the youngest member of the council, said she found the study’s conclusions compelling and matched those recently described by the city’s Equity Committee. She said she has friends with good-paying jobs who have struggled to obtain housing in Encinitas, and said she would like to toughen the city’s short-term rental restrictions, so homes are not sitting empty much of the year.

To view the report the consultants produced, visit: https://encinitas.granicus.com/MetaViewer.php?view_id=7&clip_id=3165&meta_id=165663

This story originally appeared in San Diego Union-Tribune .