News

Housing costs are deterring top-talent from entering the Los Angeles job market, and leading to higher costs in recruiting and retaining employees, according to a new survey released today by Raphael Bostic, a USC Price School of Public Policy Professor and the newly appointed head of the Atlanta Federal Reserve. Bostic led a team of USC researchers in surveying major L.A. employers accounting for nearly 200,000 jobs in key sectors including utilities, healthcare, education, government, engineering and finance. The resulting report, The Affordable Housing Crisis in Los Angeles: An Employer Perspective, released in partnership with the Los Angeles Business Council, focuses on how the high cost of housing in the region has affected employers and puts forth key recommendations.

Long Beach isn’t alone. About 40,000 residents across Los Angeles County are on the waiting list to obtain Section 8 vouchers, which means many people wait 11 years for a chance at an affordable housing option, officials said during a public hearing this week.

An increasing number of Bay Area residents are planning to move out of the area, or at least considering it, primarily because of housing prices, the rising cost of living and traffic, according to a new poll.

California will need billions of dollars in new funding for housing and transportation improvements, and to make extraordinary changes to state and local government policies, in order to meet its new 2030 climate change goals, according to new reports from state and regional government officials and UC Berkeley researchers.

The decline in homeownership rates to near 50-year lows is partly to blame for the U.S. economy’s sluggish recovery from the last recession, new data suggest.

If the home-building industry had returned to the long-term average level of construction, it would have added more than $300 billion to the economy last year, or a 1.8% boost to gross domestic product, according to a study expected to be released Monday by the Rosen Consulting Group, a real-estate consultant.

California ranked as the toughest state in the nation for first-time home buyers, who typically would be in the millennial age bracket of 18 to 34, according to a recent report by Claes Bell, an analyst with Bankrate.com. . . California consumes one of the highest percentages of people’s income for housing. Folks in that typical first-time home buyer age range, anywhere from the mid-20s to early 40s, are going to have a difficult time in many cases finding room in their budget for a California-sized mortgage payment.

Prices soared 11.4 percent higher across the nine-county region compared with the same month of the prior year, reaching a median price of $675,000 — the largest such increase in more than a year.

The possibility of a tax-code overhaul is casting a shadow over the $10 billion affordable-housing industry, which receives tax credits so valuable they often determine whether or not projects get off the ground. . . Developers said investors are valuing the credit 10% to 20% lower since Election Day. In some cases, investors have walked away, opening up funding gaps in projects already in motion. Because developers already walk a financial tightrope to build low-income housing, some projects are simply failing.

“There are many ways governments can support the construction of affordable housing. One is to pare back some of the byzantine regulations that control housing development at the state and local level—NIMBY land use and zoning restrictions, unrealistic regulations regarding construction and labor procurement methods—that drive the cost of new housing through the roof. And when that doesn’t work, city and state governments can subsidize rents. But to create an elaborate investment tax code workaround to problems that blue model governance has created through overregulation, cost inflation, and bureaucratic micromanagement only builds new layers of cost and complexity over the old ones. And of course there is the problem of moral hazard created when it becomes impossible to build housing for the average person with an average income in a given area without getting ‘help’ from insiders who can help you navigate the bureaucratic morass.

Average monthly rentals in the Inland Empire rose 6.7 percent in February to $1,501 compared with $1,407 a year earlier. The region’s occupancy rate held steady at 95.7 percent, although it was up from 95.4 percent in February 2016.

“In places such as New York and San Francisco, which offer the greatest array of high-paying jobs, rents and home prices have shot up beyond the reach of many young workers. The squeeze has even affected the Bay Area’s amply compensated technology workers, whose salaries often aren’t enough to offset the rapidly rising rents and housing costs. Technology workers who own a home in Seattle, by contrast, can expect to have about $2,000 more of disposable income left over each month after paying housing costs and taxes than those who live in San Francisco, according to a new analysis by Zillow and LinkedIn Corp. released Thursday.”

Now, a new report shows that rents have been rising even faster for houses, which are preferred by families and others seeking a bit more living space.

But now there’s push-back against this tidy assumption about what’s driving the housing crisis, and from an unlikely source: Legislative Analyst Mac Taylor. In “Do Communities Adequately Plan for Local Housing?” – a report prepared by LAO staff but carrying Taylor’s byline – the first central conclusion is that the process under which the state Department of Housing and Community Development works with cities and counties on their general plans to ensure adequate housing isn’t working. It cites little follow-through from many local governments on past promises and notes that many development plans are badly outdated and unusable. It offers suggestions on how the process might be improved to speed construction of housing stock.

California’s cities and counties make most decisions about when, where, and to what extent housing will be built. For decades, many California communities—particularly coastal communities—have used this control to limit home building. As a result, too little housing has been built to accommodate all those who wish to live here. This lack of home building has driven a rapid rise in housing costs.

Getting people out of their cars in favor of walking, cycling or riding mass transit will require the development of new, closely packed housing near jobs and commercial centers at a rate not seen in the United States since at least before World War II, according to a recent study by permit and contractor data analysis website BuildZoom.