How to make high-priced California housing more affordable – An action plan

150 150 Justin Ewers

(photo credit: Eric Allix Rogers)

At the 2013 California Economic Summit later this week, more than 500 business, government, nonprofit, and civic leaders will have a chance to review the seven action plans the Summit hopes to advance this year—which together offer a statewide plan for investing in the workers, infrastructure, and governance systems California will need to thrive in the decades to come.

These plans—like the challenges they aim to address—are all intrinsically linked: Investing in infrastructure and a skilled workforce will help the state’s economy support a range of middle-class jobs in manufacturing and other leading industries—supporting sustainable growth that can be accelerated by streamlining regulations and easing access to capital for small business.

When all is said and done, though, Californians will still need a place to come home to—the focus of the Summit’s new Housing action plan.

“Housing is always at the top of the list of things Californians are most concerned about,” Michael Lane, policy director of the Nonprofit Housing Association of Northern California—and a member of the Summit Housing action team—told an assembly of Summit action team leaders in a briefing with state officials in October.

The high costs of expensive housing

And with good reason. Affordable housing, in many parts of the state, is only getting harder to find. Seven of the 10 least-affordable housing markets in the nation are in California—the result of high demand, tight zoning restrictions, and steep regulatory costs, among other things. In cities like San Francisco, the median price of a single-family home climbed close to $1 million this summer. The median!

The impacts of these high housing costs—the biggest expenditure most families ever make—trickle into every other aspect of the state’s economy: They severely limit opportunities for low-income families, make it harder for businesses to locate in certain areas, and even hurt the environment, forcing people away from transit centers and into their cars.

This is the challenge taken on by the Summit’s Housing plan—summarized in the Policy Playbook—which proposes a range of different approaches to address California’s perennial housing crunch. From new financing tools and policy incentives to regulatory changes and zoning updates, these proposals are aimed at encouraging a diverse array of housing options close to public transportation.

“As a state, we’re going to need to direct 80 percent of new development into 5 percent of our landmass,” said Lane. “If we can do this in a way that gets workforce near transit stations, if we can accommodate for environmental and equity impacts, it can be a win-win for everyone.”

A housing action plan

The biggest obstacle, he believes, isn’t a lack of desire across the state to make these changes. “We’ve started to take down our siloes in terms of our planning [with SB 375 and other recent planning laws],” said Lane. “But we haven’t done that yet for our funding.”

At the Summit later this week, participants will have a chance to look at the Summit’s proposed solutions—including tapping into cap and trade revenues, linking funding to zoning updates that promote transit-oriented development, and taking advantage of recent changes to the California Environmental Quality Act that will make it easier to build residential developments within urban areas.                                                                  

“The free market isn’t going to produce the housing we need—or overcome the obstacles standing in the way,” Lane said. “The state will need to have a role.”

What that role entails—and how the state’s actions on affordable housing should be prioritized—will be the source of discussion at the Summit later this week.


Justin Ewers

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