What you want to know about California's failed housing affordability law
Our story on California’s failed 50-year-old housing law generated lots of questions from Times readers.
The law is the state’s primary tool to encourage housing development and address a statewide shortage of homes that drives California’s affordability problems. But, as anyone who is trying to afford a home in California knows, costs are continuing to spiral upward.
Why hasn’t the law worked? It requires cities and counties to produce prodigious reports to plan for housing — but doesn’t hold them accountable for any resulting home building. Decades of tinkering with the law has led to planning requirements that local governments hate so much they’ve pitched ideas such as letting prison beds count toward low-income housing goals. And now state officials don’t have basic information on the law’s effectiveness, including how many homes are actually built.
Here’s a sample of what Times readers told us they want to know about the law, known formally as the “housing element,” and its effects on the state’s larger housing problems.
It looks like developers are building enough houses in my city. Why are prices still going up?
The law sets out homebuilding goals for each city and county over an eight-year period to keep pace with projected population growth. The idea is that the supply of new homes will meet the demand.
We included a searchable table in our story for readers to see how many homes were built in their communities compared to the targets. A reader from San Clemente noticed his city had outpaced its housing goals by hundreds of new homes, but costs still were rising. Why?
Housing markets are regional. Even if there’s enough new homebuilding in one city, if there’s insufficient growth nearby the problem will persist. So while San Clemente met its overall housing goal, the data show, Irvine and Santa Ana missed theirs by thousands.
Also, the housing targets themselves might require reevaluation. The independent Legislative Analyst’s Office found recently that Bay Area counties were on track to meet their overall housing goals during the current eight-year period that ends in 2023. But the Bay Area is adding hundreds of thousands more jobs than homes, which is driving up the demand for housing beyond what the targets had anticipated.
What’s the reason not enough homes are getting built?
Cities don’t build houses. Developers do. Local government rules — including neighborhood opposition to new homes — play a role in housing supply. But many other factors, such as construction costs and mortgage interest rates for prospective homebuyers, matter a lot. So any state law is limited in forcing homebuilding to happen.
Reader Bruce Ross, who works for Assemblyman Brian Dahle (R-Bieber), had an observation about demand.