What is affordable housing?
Homeless systems of care in the Bay Area and beyond have partnered with affordable housing developers to acquire, build, and/or finance units to house individuals experiencing homelessness and other extremely low income (ELI) individuals. ELI housing is affordable housing specifically targeted toward extremely low-income individuals, whose incomes do not exceed the greater of either 30% of the Area Median Income (AMI) or the federal poverty line.
What is the need for affordable housing development in the Bay Area?
Median rents in the nine Bay Area counties are some of the highest in the state – and the nation. Looking at the median rent from 2015 to 2019 across the nine counties, the weighted average rent was $2,178 per month, but was as high as $2,316 in San Mateo County; by contrast, the median rent in California in 2019 was $1,503, and in the United States it was $1,062.1Quick Facts, California, U.S. Census Bureau.
In addition to the tens of thousands of people who are experiencing homelessness in the Bay Area, looking at household income reveals the destabilizing effect of high housing costs on Bay Area residents. There are more than 400,000 households in the Bay Area who are extremely low-income (ELI) or “housing cost burdened.” Almost 300,000 households are severely housing cost burdened, paying more than 50% of their income on rent.2Consolidated Planning/CHAS data, 2013- 2017 period, renters only, HUD. In 2019, the California Housing Partnership found that the Bay Area needs an additional 222,273 units of extremely or very low-income rental housing in order to accommodate the need.3Housing Needs Dashboard, California Housing Partnership.
The impacts of the COVID-19 pandemic and the upcoming removal of the federal eviction moratorium likely will result in a much greater need for deeply affordable housing.
Bay Area Bright Spot: Bay Area
All Home released a Regional Action Plan (RAP) in April 2021 to reduce homelessness by 75% in the Bay Area. The plan, created by leaders from across the Bay Area, was developed in the midst of the COVID-19 pandemic by key policymakers, stakeholders, and people with lived experience. The RAP uses a 1-2-4 framework that focuses on three solutions to support individuals living without shelter: for every 1 unit of interim housing, there will be 2 units of permanent housing, and 4 units of homelessness prevention.
What are the bright spots in the Bay Area’s affordable housing development?
The following are a selection of impactful affordable housing development strategies being used in the Bay Area that could be adopted by other communities.
Building and Preserving Community Land Trusts
Building and Preserving Community Land Trusts is an anti-gentrification solution that de-commodifies land and ensures that communities have control and ownership over their own spaces. A Community Land Trust (CLT) is a community-based nonprofit membership housing organization run by an elected Board. The Board consists of residents in land trust-sponsored housing, the broader community, and technical experts.
The City of Oakland’s Community Land Trust (OakCLT) acquires land and governs it based on a shared-equity structure to ensure the continued affordability of CLT homes. A Board of OakCLT residents and community members makes decisions on the resident-controlled, community-owned land. The OakCLT single family homes are available to families at or below 80% AMI for the city of Oakland, so long as they are able to pay 3% of the purchase price as a down payment, have a good credit score and a steady income.
The Community Land Trust Association of West Marin (CLAM) is located in a rural coastal community of Marin County where many Bay Area families purchase second homes or vacation homes. CLAM helps local low-income families afford housing through shared housing solutions such as tenants-in-Common homeownership and Shared Equity Ownership.
The Bay Area Community Land Trust (BACLT) takes land out of the speculative market to create permanently affordable housing that are cooperatively owned by a community.
Leveraging Housing Bonds and Private Funding
Leveraging innovative funding sources for affordable housing through affordable housing bonds and private funding can help close the gap between revenue and need for affordable housing development.
Santa Clara County
In 2020, City of San José voters approved Measure E, a real estate transfer tax increase. 45% of the funds raised go toward Permanent Supportive Housing and affordable rental housing for extremely low-income households.
In 2016, Santa Clara County voters passed Measure A, dedicating $950 million for affordable and supportive housing, including ELI housing. As of February 2021, they have committed close to 3,000 units for development.
San Francisco County
In 2019, San Francisco voters approved Proposition A, a $600 million general obligation bond to develop and preserve affordable housing. The bond is expected to create over 1,600 housing opportunities.
Inclusionary Zoning Policy
Inclusionary zoning requires that a stated portion of a new housing development be dedicated as affordable and available to low- or moderate- income households. Putting policies in place that adopt inclusionary zoning can reduce some of the challenges that exist when communities try to develop affordable housing.
Santa Clara County
In 2020, the County of Santa Clara’s Department of Planning and Development, proposed a Countywide Inclusionary Housing Ordinance that would apply to the development of three or more housing units in the unincorporated areas of Santa Clara County. The proposed Ordinance would require 16% of units within a new residential development be dedicated as affordable housing units.
The City of Santa Clara adopted its inclusionary housing ordinance in 1992, which requires that new housing developments of 10 or more units must provide at least 10 percent at below market rates for moderate income households.
The City of San José’s Inclusionary Housing Ordinance, adopted in 2010, requires all residential developers who create new, additional, or modified sale or rental units to provide 15% of housing on-site that is affordable to income qualified buyers and renters.
San Mateo County
San Mateo County enacted an Inclusionary Housing Ordinance in 2009, that calls for all new multi-family residential buildings with 5 or more units to set a minimum of at least 20% of those units dedicated for sale or rent to extremely low-income (ELI), very low-income (VLI), or moderate-income households.
In conjunction with Home For All San Mateo County, eighteen cities in San Mateo County have adopted inclusionary zoning or other below-market policies that require a share of new housing development to be affordable to low- or moderate- income households.
Contra Costa County’s Inclusionary Housing Ordinance facilitates the development and availability of housing affordable to a broad range of households with varying income levels within the county. The rules require that residential buildings with more than 5 units dedicate at least 15% of those units be set aside for affordable housing. For buildings with 5 to 125 units for sale or rent, 20% of the 15% must be affordable to low-income households, while the other 80% must be affordable to moderate-income households.
ADUs and Tiny Homes
An Accessory Dwelling Unit (ADU) is a permanent unit that exists besides, near, or in conjunction with a larger, pre-existing home. Tiny homes are small units that are not always associated with a pre-existing home.
Napa County’s Junior Unit Initiative Program provides technical assistance and below-market financing to create Accessory Dwelling Units (ADUs). The program comes with forgivable financing up to $50,000 and an additional $25,00 in the form of deferred interest-free loans for Conversion ADUs. Homeowners are required to live in either the ADU or the primary unit and rent the other building to a low-income tenant.
Youth Spirit Artworks (YPA) constructed a tiny home village in the City of Oakland for Oakland and Berkeley unhoused youth between ages 18-23. The nonprofit raised almost $1.3 million to build the homes and operate the site. Each tiny house cost $12,500 to build. The city of Oakland leased the 2-acre site to the nonprofit free of charge, which has two communal yurts, one a shared kitchen and the other a shared living area. The youth-led initiative incorporates art, community, and empowerment, and allows residents to stay for up to three years.
In 2019, Sonoma County opened a tiny home village, Benton Veterans Village, for veterans experiencing homelessness. Veterans living at the village each have their own home and access to Veterans Affairs case managers who live on site.
Home Sharing Match-up Programs
Home sharing programs match people for house share situations. It is different from a traditional roommate or room renting experience, as underlying the program is participants’ intentions to help each other. Often used with seniors as they age in place, programs have expanded to work with Veterans and people experiencing homelessness.
Alameda, Contra Costa, Marin, and San Francisco Counties
Home Match is a home sharing program run by Covia, a nonprofit organization serving older adults. The program began in 2012 as a pilot program in Marin County, where there is a high concentration of older adults and one of the highest housing costs in the country. The program has subsequently expanded to offer home sharing in San Francisco, Contra Costa, and Alameda counties.
The City of Napa’s Home Sharing Match-up Program matches home providers who have an extra room in their home with renters seeking an affordable place to live in Napa County.
Rehabilitation of Underutilized Buildings
Rehabilitating Hotels, Motels, or other underutilized building into Permanent Housing is another strategy to take advantage of existing resources for affordable housing development.
In 2016, the City of Santa Rosa converted The Palms Inn into permanent supportive housing for 120 homeless veterans.
In 2020, the Oakland City Council purchased a California College of the Arts dormitory to covert to permanent housing and a temporary shelter using Project Homekey funds. The building will have 42 units of Permanent Supportive Housing for seniors once the rehabilitation is complete.