A widening gap between California’s housing production targets and actual population trends is raising questions about whether the density push in coastal markets is addressing the right problem. Eric Law, a retired Navy intelligence officer who now chairs the Peninsula Community Planning Board, has spent years navigating the intersection of state mandates, city policy, and community reality. His vantage point — overseeing land use decisions for 67,000 residents on San Diego’s Point Loma peninsula — offers a ground-level view of how top-down housing policy collides with the practical limits of aging infrastructure, constrained geography, and shifting demographics.
What emerges from that view is not simply a debate about units and density, but a deeper tension over who housing policy is actually serving. Law argues that San Diego is not experiencing a housing crisis so much as a housing affordability crisis — and that the distinction matters enormously. The state and city, in his assessment, have been tearing down the bottom rung of the housing ladder while building products that neither match what residents want nor reach the people most in need. Meanwhile, the infrastructure underpinning the peninsula — much of it built during World War Two — strains under the weight of mandates written without accounting for it. The result is a city that calls itself America’s Finest while quietly pricing out the next generation of homeowners.
Outdated Population Projections
California’s housing mandate requires San Diego to permit 108,000 new units before 2029. That target was built on projections showing a 25 percent population increase by 2035. Law says those projections are not materializing. San Diego’s population flattened in 2019 and has been declining since. Law says the city lost approximately 5,000 residents in the past year and may lose another 5,000 to 10,000 in 2026. The market signals are consistent with that demographic picture. Rental rates have declined by approximately 5 percent. Home prices are broadly flat, with variation concentrated at the high end. Inventory has increased.
Law describes the market as having reached an unusual equilibrium that San Diego, historically a strong seller’s market, has not seen in recent memory. “We’re at a point where the needle is tipping back and forth between a seller’s market and a buyer’s market,” Law says. “Which is unique for San Diego.”
Housing Mismatch
Against this backdrop, Law argues that the housing produced under density mandates does not align with what residents actually want. He cites survey data suggesting that 80 percent of millennial families prefer single-family homes. The city has responded to housing pressure by approving high-density apartment projects and is now seeing rising vacancy rates.
The units produced through density bonus programs are often small. Law describes some affordable units as ranging from 420 to 468 square feet, sizes he and community members call “jail cells.” These units are marketed as affordable housing solutions. Law questions whether they represent genuine affordability or merely a smaller product priced out of reach for many residents.
Parking adds another layer. The city and state have pushed no-parking or reduced-parking requirements as a cost-reduction measure, but Law says off-street parking remains a high priority for renters. He reports no meaningful difference in rental rates between units with and without parking, suggesting the cost savings are not being passed to tenants. Surrounding neighborhoods absorb the spillover effects.
Upzoning Raises Costs, Not Affordability
San Diego’s urban growth boundary constrains land supply. When a parcel is upzoned to allow greater density, the land’s value increases. Law says that increase gets passed through to construction costs, rents, and sale prices.
“Every time a lot is upzoned, the cost of that land goes up,” Law says. “We know that gets passed along.”
The result, in his view, is denser housing that remains expensive — not the affordable product the mandates are intended to produce. Law argues that honest discussion of housing affordability requires acknowledging this dynamic rather than treating density as a simple solution.
San Diego’s homeownership rate, which Law puts at approximately 48 percent compared to a national average of around 65 percent, illustrates the cumulative effect. The gap is wider still in lower-income and disadvantaged communities — the very populations the mandates are meant to serve.
Where Real Demand Exists
Despite his skepticism about current policy, Law identifies areas where real demand exists. The south of the city, where greenfield development is more feasible, appears to be growing. He suggests that if the city and county opened cheaper land for development rather than concentrating approvals on expensive infill sites, there could be meaningful progress on the single-family supply the market is seeking.
The Peninsula Community Planning Board, which Law chairs and was reelected to lead in early 2026, has pressed city officials and state legislators on the gap between mandate-driven density and actual market conditions. Law says the board supports well-designed development and works to move compliant projects through the approval process. His concern is that the current policy-driven approach produces housing that does not serve residents most in need, while displacing the population the mandates were designed to help.
Whether state housing targets will be recalibrated to reflect San Diego’s demographic reality remains to be seen. For investors and developers, Law’s assessment suggests that single-family and starter-home products, where land costs allow, may represent a more durable opportunity than the high-density apartment pipeline current policy incentivizes. That possibility depends on political willingness to revisit both the population assumptions underlying the mandates and the land-use restrictions that keep developable parcels expensive.
About the Expert: Eric Law is chair of the Peninsula Community Planning Board in San Diego, California, a position he was reelected to in early 2026. His focus is on land use, housing policy, and community planning within San Diego’s coastal neighborhoods.
This article is intended for informational purposes only and does not constitute legal, financial, or investment advice. The views and opinions expressed herein reflect those of the individuals quoted and do not represent an endorsement of any company, product, or service mentioned. Readers should conduct their own due diligence and consult qualified professionals before making any investment decisions.
