California is producing less than half the new homes it needs to meet demand, according to a new comprehensive analysis by California’s Department of Housing and Community Development. Justin Sullivan/Getty Images
California is producing less than half the new homes it needs to meet demand, according to a new comprehensive analysis by California’s Department of Housing and Community Development. (Justin Sullivan/Getty Images)

Housing Crunch Exacts a Heavy Price on Californians

Housing Crunch Exacts a Heavy Price on Californians

California is producing less than half the new homes it needs to meet demand in the Golden State.

In its first comprehensive analysis since the year 2000, California's Department of Housing and Community Development paints a bleak picture of the state’s housing landscape. While it points to some hopeful developments, the report suggests lawmakers will need to consider serious policy changes if California is going to build the projected 1.8 million new homes needed by 2025.

The Statewide Housing Assessment Report is still in draft form, and its authors are gathering public input at workshops around the state. On Monday a small group of mostly local government representatives and advocates met in Fresno to hear the report's findings.

"About a third of all California renters today are paying more than 50 percent of their income in rent," California Department of Housing and Community Development Director Ben Metcalf told the group.

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Those paying the largest share of their income for rent and transportation aren’t concentrated in expensive cities like San Francisco -- they're largely living in rural Northern California counties and in the Central Valley.

“We’re seeing home ownership rates at the lowest level they’ve been since World War II," Metcalf said. And, he added, while just 12 percent of Americans live in California, 22 percent of America’s homeless live here, more than in any other state.

Among the challenges driving the lack of affordable housing is unstable funding, the report finds. Federal allocations for affordable housing declined in California from 2003 to 2015. There just aren’t enough affordable rentals, and even for those who get assistance, Section 8 vouchers can’t keep pace with soaring rents.

The authors also point to regulatory hurdles and land use policies that jack up development costs and delay building.

On the upside, the report finds some positive impact from state and local bonds for affordable housing and permanent housing for the homeless, along with revenue from the state's cap-and-trade program.

Still, the report suggests there are big consequences resulting from the failure to meet housing needs. When you factor housing in, California has the highest poverty rate in the country. Housing instability affects people’s health and kids’ academic performance. And as people move farther from jobs, long commutes increase pollution.

Overall, the report concludes the lack of housing costs the California economy almost $240 billion a year.

Once they’d heard the findings, the group in Fresno offered input. They discussed special barriers facing disabled communities and highlighted housing issues unique to vulnerable populations.

Ashley Werner, an attorney with the Leadership Council for Justice and Accountability, a nonprofit that helps low-income communities, raised concerns about undocumented immigrants.

"I think there’s a lot of different policy solutions we can put in place to protect them, and protect our whole population,” Werner said. “I think that’s especially important right now."

Public comment continues in cities around the state until March 4. A final housing assessment is expected to be ready for policymakers to consider this summer.

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