The extent of our state’s housing crisis cannot be overstated. Nine of the 10 least-affordable large housing markets in the country are in California, with metropolitan San Francisco ranking as the second-least affordable. This data is not exclusive to urban centers - 8 of the 10 most unaffordable housing markets in areas with fewer than 500,000 residents are also in California1.
Fifty percent of community members in San Mateo and Santa Clara Counties are severely housing-burdened – meaning they pay more than 50 percent of their income on housing expenses2. The counties’ lowest-income residents are spending close to two-thirds of their monthly income on rent, with little money left to cover other expenses such as food, transportation and child care3.
Sadly, we know that the future holds more of the same. The California Association of Realtors forecasts rising home prices this year. Median home prices are forecast to jump 4.2 percent to $561,000 in 2018. Renters will not fare any better. According to the California Housing Partnership, San Mateo County renters currently need to earn $9,503 per month, or 5.5 times the state minimum wage, to afford the average monthly rent of $2,8514.
This is why we are working hard to pass Senate Bill 828, authored by Senator Scott Weiner.
SB 828 intends to strengthen the Regional Housing Needs Assessment (RHNA)5 and make local jurisdictions more accountable to its mandate. Currently, the RHNA faces serious limitations of design and implementation. First, the RHNA does not take into account historic underproduction of housing, nor does it have a rollover mechanism to ensure that communities who underperform in one cycle are held accountable to their remaining obligation when the next cycle starts. Second, it underestimates demand. When local jurisdictions stifle housing production, they also stifle population growth – even when there is clear demand, as seen by soaring rental/home pricing. And third, it allows for discretionary allocation of housing allocations by regional governments with very little state oversight. This, more often than not, results in politically-driven decisions rather than data-based ones.
This bill intends to ensure that the RHNA process reflects accurate housing needs and that local jurisdictions are held accountable for not meeting their housing goals. This bill will:
- Require the Department of Housing and Community Development (HCD) to do a one-time unmet need assessment for every California region, before the next housing cycle, and then add those numbers to the forecasted allocations. This will act as a reset for every part of California to get on track after decades of underproduction.
- Establish methodologies that acknowledge the particular need for moderate and above-moderate income housing in areas where housing prices are increasing at a rate far faster than wages.
- Authorize HCD to challenge inequitable allocations between comparable jurisdictions.
- Require HCD to rollover jurisdiction-specific underproduction from the last cycle to the next if a city has underperformed and not met their RHNA.
- Prohibit regional planners from purposely under-allocating in cities that they know are underperformers and will have rollover numbers.
Help us ensure that California remains vibrant and diverse. Support SB 828!
1 The National Association of Homebuilders/Wells Fargo Housing Opportunity Index, 2017
4 California Housing Partnership. https://1p08d91kd0c03rlxhmhtydpr-wpengine.netdna-ssl.com/wp-content/uploads/2016/05/San-Mateo-County.pdf
5 The RHNA is the state-mandated process to identify the total number of housing units (by affordability level) that each jurisdiction must accommodate in its Housing Element, which should show how the community plans to meet the existing and projected housing needs of people at all income levels.