Creating More Workforce Housing for a Growing Region
The Bay Area faces an unprecedented statewide housing crisis that threatens our economy, environment, and diverse communities. Despite visionary state planning goals to “build in” and reduce our greenhouse gas footprint, our system of approving and building housing is failing to provide infill housing at a rate that corresponds with population and job growth.
The California Department of Housing and Community Development estimates the state needs to build 180,000 new units of housing annually by 2025 to meet projected growth, over 100,000 more units than we are currently building annually. Between 2011 and 2015, the Bay Area added over 500,000 jobs, but only 65,000 housing units. That’s 1 unit of housing for every 8 jobs created.
This severe supply-demand mismatch, coupled with the exorbitant cost of building housing (the average cost for one unit of affordable housing is $591,000 in San Francisco), has drastically driven up housing costs for Californians. The average California home now costs about two and half times the national average home price. The average monthly rent in California is 50 percent higher than the rest of the nation and even higher in cities such as San Francisco, San Jose, Oakland, and Los Angeles.
Lack of affordable housing, particularly in coastal California, is one of the biggest drivers of institutional and generational poverty cycles. The Legislative Analyst’s Office found that the bottom 25 percent of income earners are spending 67 percent of their income on housing. This is clearly not acceptable or sustainable.
The inability of our traditional housing delivery system to meet demands has resulted in the displacement of longtime residents, greater sprawl, increased traffic and greenhouse gas emissions from in-commuters, and a strain on businesses trying to grow in the state. It is imperative we find new ways to deal with this old and persistent problem to ensure the Bay Area evolves into a place accommodating all workers and families, and provides a secure future for our children.
Our Housing Committee meets regularly to engage on our related policy priorities, engage with guest speakers, and network.
Kofi Bonner, Regional President, FivePoint
Denise Pinkston, Partner, TMG Partners