Nearly halfway through California’s current housing cycle, Coronado has yet to add any units that count toward the city’s affordable housing goals.
In 2025, 37 units were constructed in Coronado — mainly single-family homes and accessory dwelling units — but none were affordable under state definitions, according to the city’s annual Housing Element progress report scheduled for review by the City Council on March 17.
The report, required by California law, tracks how cities are progressing toward their the Regional Housing Needs Allocation (RHNA), the state’s system for assigning housing targets across income levels during an eight-year planning cycle.
Every eight years, a new RHNA cycle begins, during which cities must pass a new Housing Element approved by the California Department of Housing and Community Development (HCD).
In the current cycle, Coronado was allocated 912 units, though it must include a 15 percent buffer, pushing the total to 1049. The allocation was a massive increase from that of past cycles, and city leaders balked at it, saying it was disproportionately high considering the city’s size and built-out nature. After a period of noncompliance and a failed lawsuit, Coronado begrudgingly passed its current plan in October 2023.
The state does not explicitly require that cities themselves produce affordable housing, but its mandates do require that cities make progress toward reaching affordable housing goals, a relatively recent shift in enforcement brought about by a series of legislative changes made beginning in 2017.
Coronado’s 2025 progress report shows 27 single-family homes and several accessory dwelling units (ADUs) constructed in the last year. All of them are priced at market rate, placing them into the “above moderate income” category.
Last year was not an outlier, either. Coronado has not added a single affordable housing unit during the current housing cycle, which runs from 2021 to 2029, according to data from the San Diego Association of Governments (SANDAG).
The report is expected to be approved during the March 17 City Council meeting and is unlikely to surprise. City leaders have long grappled with the tension between the state’s requirements, the city’s built-out nature, and the fact that private developers rarely build affordable housing without subsidies.
The gap between market-rate construction and affordable housing requirements is reflected in the city’s RHNA progress so far:
To combat this, the city in Dec. 2025 moved forward with the purchase of a $6 million complex to be used as affordable housing. Its eight units are currently rented market rate, but will eventually be converted to affordable housing.
The city will use $1.8 million from its affordable housing in-lieu fund to purchase the property, with the remainder as an intra-fund loan from the city’s general fund, which will be repaid over time by future housing in-lieu fees.
These fees are paid by developers who choose not to include affordable units in their projects. In another move to meet state requirements for affordable housing units, the City Council in July 2025 approved a higher, phased-in housing in-lieu fee that will generate more revenue for the city to produce its own affordable housing.
The approved schedule set the new rate at $25 per square foot, effective in July 2025. Any current projects were grandfathered into the former, flat rate of $7,000 per unit.
Then, starting in July 2027, the fee will increase to $35 per square foot. In July 2028, it will increase again to $45 per square foot, leveling out at $55 per square foot in July of 2029. After that, the fee will be adjusted annually for the Construction Cost Index (CCI).
The city will also evaluate the change to the fee in the spring of 2028 to assess whether the higher fee impacted the market negatively. For example, some worried that assessing too high a fee would dissuade developers from building multi-unit projects and instead would simply build single-family homes, which are not subject to the fee.
If the council approves the Housing Element progress report, as it is expected to, it will not change policy. Tuesday’s vote will simply allow city staff to submit the report by the state’s April 1 deadline.
