There is no debate or question that we have a serious housing affordability crisis in this state, and we didn’t get here overnight. Each year, we need to build roughly 180,000 homes just to keep up with population growth, and over the last decade we have fallen short by at least 1,000,000. At the core of our exploding housing affordability crisis is basic economics: we have spiking demand coupled with stagnating supply, this leads to skyrocketing housing prices. This is a critical issue for small businesses who are seeing their workforce driven out of this state due to prohibitively high housing costs.
Unfortunately, Senate Bill 2 (Atkins), Senate Bill 3 (Beall), and Senate Bill 35 (Weiner) do nothing to address these fundamental economic realities, but instead raise more taxes on struggling small businesses and working families, put California further into debt, and drastically raise labor costs to build a home.
The bad news is: there’s very little housing in this housing package.
The new funding will produce only a tiny fraction of the affordable housing Californians need. And given the economic and regulatory pressures on housing, such housing won’t be produced quickly or cheaply.
The bills leave in place the tax, environmental, and regulatory regimes that add so much to the expense and difficulty of building housing in the state. And in some places, legislators have offered goodies, in the form of wage and other protections to labor interests to get their buy-in. Such incentives may add to the cost of housing, when the state desperately needs to make housing cheaper. The way that the building trades, in particular, have leveraged this crisis would be shameful, if organized labor in this state were still capable of shame.
One of the striking signs of delayed adulthood is the rising number of young adults who live in their parents’ home – now the most popular living arrangement for young adults. A third of young people, or 24 million of those aged 18 to 34, lived under their parents’ roof in 2015. More young adults lived with parents than with a spouse in 2016. Almost 9 in 10 of the young people who lived with their parents a year ago are still living there.
More than 100 local governments have inclusionary ordinances. But a 2009 state appeals court ruling exempted rental units.
So as part of an overall package of housing bills, Democratic lawmakers want to overturn that exemption. Two identical bills are under consideration in the Legislature, AB 1505 and SB 277.
State lawmakers can pass all kinds of bills aimed at building more affordable housing. But they can’t repeal the fundamental law of supply and demand for desirable land. Land costs are what really drive up housing prices and make homeownership increasingly beyond the reach of so many Californians. Rentals are virtually impossible, too, in attractive regions along the coast, especially San Francisco.