Why National City Holds Steady

San Diego’s apartment market just had its hardest stretch in 25 years. One submarket held up better than the rest.

Data as of October 12, 2026 | Source: CoStar Group

San Diego apartment vacancy reached 6.2% in early 2026, the highest level this century. A record wave of new buildings, slower job growth, and renters stretched thin all pushed the same direction.

National City and the surrounding South Central submarket felt it too. But over the past decade, it has held up better than the region around it every year.

Its worst quarter beats the metro today

CoStar’s records for National City/South Central go back more than two decades. The highest vacancy the submarket ever posted was 5.2%, in the first quarter of 2011. San Diego metro vacancy today is 5.8%.

Put simply: the submarket’s worst quarter on record, set in the aftermath of the Great Recession, is better than the region’s current vacancy.

Twelve years in a row

• Vacancy has been below the metro every year since 2014, and it still is in 2026 (5.0% vs. 5.8%).

• Over the past decade (2016 to 2025), vacancy averaged 3.4%, against 4.7% for the metro.

• Rents rose 49% from 2015 to 2025, compared with 41% across San Diego. They rose in every one of those years. Metro rents slipped in 2025 for the first time in 15 years.

• Concessions are the lowest in the region. Concessions are the discounts landlords offer to sign a lease, like a free month. In National City they run 1.5% of asking rent, the lowest of San Diego’s 14 submarkets.

  
  

Why it holds

Jobs that stay put. 

Naval Base San Diego, the NASSCO shipyard, and Paradise Valley Hospital anchor the area. Many residents work in the trades, service industries, and the military. These are jobs done in person, close to home.

Transit to the job centers. 

The Trolley Blue Line runs from National City to Downtown. The Mid-Coast extension reaches UTC and Torrey Pines without a car.

Price. 

Average asking rent is $2,014, about 22% below the metro average of $2,596.

Limited new supply. 

The submarket’s apartment stock grew 8.9% over the past decade, roughly half the metro’s 16.4%. Only 100 units are under construction today.

The other side

National City isn’t immune. Vacancy rose 0.8 points over the past year. About 75 units were absorbed (net new units rented) over the past 12 months, while 204 new units opened. Property managers report leaning on concessions and negotiating renewals. They point to tighter immigration policy, high living costs, and military deployments.

The case is relative, not absolute. CoStar forecasts National City at 4.9% vacancy at year end 2026, vs. 6.0% for the metro, and 4.3% vs. 5.8% by 2030. Forecasts can miss. The 12-year record is what has already happened.

That record is why we build here. KIRE has developed 13 workforce housing in National City since 2014.

Sources: CoStar Group, National City/South Central submarket report and San Diego market report, data as of October 12, 2026. Ten year averages, cumulative rent growth, and stock growth are calculated from CoStar annual data. Forecasts are CoStar’s and are not guarantees.

Disclaimer: This material is for educational and informational purposes only and should not be relied on as investment, tax or legal advice. This is not an offer to sell or a solicitation of an offer to buy any security.