- The San Francisco Bay Area is one of the most unaffordable places to live in the US.
- A new report explores several solutions that could alleviate the Bay Area’s affordable housing crisis, namely in the East Bay.
- The report, compiled by the Bay Area Council Economic Institute, says that Bay Area communities should look to build affordable homes near transit. The influx would allow for more density and give residents more disposable income since they wouldn’t need to commute by car as much.
- Several other cities are considering investing in transit-oriented, affordable housing developments.
The San Francisco Bay Area has become the epicenter of California’s affordability crisis.
Largely drawn by high-paying tech jobs, people have flocked in recent years to the Bay Area at rates that the housing market cannot keep up with. In April, the median price of a home in the Bay Area shattered records at $820,000.
A new report from the Bay Area Council Economic Institute (BACEI) explores a few ways to tackle the region’s affordable housing crisis.
The researchers focus specifically on reducing housing prices in Alameda County, where residents need to make at least $181,130 to afford a median-priced home (at around $875,000), according to the California Association of Realtors. The median rent in the East Bay county, which includes Oakland and Berkeley, is around $3,020 – lower than the San Francisco metro median of $3,300, but still expensive compared to other major metro areas.
The report proposes 20 policy solutions. The most promising ones include:
- Extend the BART subway line to Livermore, a city that’s cheaper than some other parts of the Bay Area. In late May, the Pleasanton Weekly reported that BART voted against expanding subway service to Livermore, but the regional rail authority could still pursue the proposed project.
- Build a new affordable housing development near Fremont’s second BART station. In 2014, the City of Fremont called for the development of a mixed-use neighborhood in an area surrounding the station that’s largely vacant parcels and industrial buildings. Fremont is a hub for high-tech manufacturing, and building more housing in the area could allow residents to live closer to work. The city’s plan includes up to 4,000 apartment units, and multiple developers have already had their master plans for developments approved.
- Pass more legislation that encourages housing developments near public transportation. There’s current legislation in the works that could encourage this kind of development in the future.
- Enforce building targets that require California counties to create enough housing to meet resident needs. In 2017, two bills passed that will make it harder for developers to reduce the density on their housing projects unless the surrounding county has met its targets.
- Complete Oakland’s four existing housing megaprojects. These include the Brooklyn Basin Development of 3,100 housing units, and a market-rate townhome project at the former Oak Knoll Naval Hospital Site.
These recommendations focus on investing in transit-oriented developments, which the researchers believe would reduce housing prices in the Bay Area. The BACEI reasons that if there were more affordable housing developments near subway and bus stops, it would grow the region’s economy.
The influx of housing would not only create density, but also give residents more income to spend on rent since they wouldn’t need to drive a car every day.
Commuting by car can be expensive. According to a 2017 study from AAA, owning and operating a new vehicle costs drivers an average of $8,469 annually, or $706 each month – which is almost like paying a second rent.
In the same vein, the report encourages local legislators and developers to prioritize high-density housing developments, rather than sprawling neighborhoods with high-cost homes.
Some policies – like strict rent-control measures and occupancy taxes on Airbnb rentals – could make the Bay Area’s housing shortage worse, according to the report. The BACEI argues that enacting strict rent-control policies can deter developers from building more rental properties. (This idea is highly debated among economists and housing experts.) The researchers added that banning or adding taxes on short-term rentals in Oakland would also deprive some homeowners of an income source.
Several other American cities are planning transit-oriented, affordable housing developments.
Over the next two decades, Sound Transit – the transit agency serving the greater Seattle area – will buy land as it builds out its light rail expansion. On the agency’s surplus property, it may build affordable housing developments, Next City reports. The Los Angeles Metro is also providing $9 million to developers at a low-interest rate to construct affordable housing within a half mile of transit lines.
The Council recommends that the Bay Area moves quickly on at least a few of their proposed solutions.
“Solving the housing affordability crisis is not an Oakland issue, and it is not a Berkeley issue. It is an every city, every neighborhood issue,” the report says.