Study: 20 Strategies for Improving (or Worsening) Housing Crisis

The Bay Area Council Economic Institute today (May 29) released a study showing how 20 different strategies – from fast tracking mega projects to eliminating certain parking requirements – can help improve (or worsen) housing affordability for thousands of households in Alameda County.

Although Alameda County has added 125,000 jobs since 2012, the number of new housing units permitted over that period has totaled just 27,505. The lack of supply has pushed home prices and rents steadily upward, with the median home price now standing at $800,000 and average rents near $2,500.

The housing shortage and upward pressure on prices that has resulted means 40 percent of Alameda County households – or almost 224,000 households – are considered housing cost burdened. That means they are paying more than 30 percent of their income on housing costs. The problem is even more severe for the county’s lower and middle income households, with those making $75,000 or less annually comprising 76 percent of the households defined as housing cost burdened.

The study analyzed how the addition of thousands of new housing units in transit-rich areas and the completion of large housing developments in several cities can boost supply and put downward pressure on prices and rents. For example, a plan to add 4,000 housing units in Fremont near the Warm Springs BART station can improve affordability for 2,821 households.

Read Solving the Housing Affordability Crisis>>

Strengthening requirements on cities to meet their housing obligations would improve affordability for more than 7,000 households. Collectively, cities across Alameda County permitted just 44 percent of the housing units they were required to approve. Legislation (SB 828, Wiener) that the Bay Area Council supports would bolster the requirements on cities to keep pace with housing demand.

While many of the strategies the study examined involved building new housing, some looked at how certain policies can worsen housing affordability. Expanding rent control to cities across Alameda County would worsen housing affordability for 10,353 households, the study found, largely by discouraging investment in new housing construction.

The study also looked at a number of novel approaches. Reducing parking requirements in Oakland by 10 percent across the city can improve housing affordability for 1,339 households. Maximizing the number of accessory dwelling units, also known as granny or in-law units, in Berkeley under statewide legislation approved in 2016 to streamline approvals of these units would reduce the housing cost burden for 604 households.

An earlier report by the Economic Institute looked at how similar strategies change affordability in San Francisco. Read the San Francisco housing affordability study>>

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