ABUNDANT HOUSING

 

Summary

• California is in the worst housing and homelessness crisis since the Great Depression.

• Abundant housing is the key to more homeownership, lower housing prices, and lower rents.

• We can create homebuilding and abundant housing by up-zoning cities and suburbs and closing the loophole in the California Environmental Quality Act (CEQA), which allows frivolous, repetitive, and anonymous lawsuits

• We must organize a movement to overcome selfish NIMBY (not-in-my-backyard) interest groups, a small group of labor unions, and anti-development environmental groups including Sierra Club and NRDC.

 
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Problem

California homes are more expensive than those in every other state except Hawaii. Where 56 percent of Californians could afford a middle-class home in 2012, in the third quarter of 2017, just 28 percent could.

Rents are the highest in the nation and rising — 49 percent in San Francisco and 25 percent in Los Angeles since January 2011. Most of the country’s most expensive rental markets are in California. Deaths of homeless people on the street are rising.

The high price of housing is choking-off half of all economic growth nationally while it is causing California to lose $140 billion annually in economic output.

Homeownership still matters. People who own homes have 36 to 45 times more wealth than people who rent.

The young are disproportionately impacted. While just one out of four Californian Millennials (25—34) own a home — the third lowest homeownership rate among Millennials in the U.S. — homeownership among baby boomers is nearly the same as the national average.

It takes three times longer to save up for a home downpayment in California than nationally. It would take a median-income resident 29 years to save for a downpayment on a median priced home in San Francisco (27 years in Los Angeles).

The housing shortage is behind high housing costs. San Francisco added 38,000 jobs but just 4,500 new housing units between 2015 and 2017, and now seven million more people are expected to move to California over the next 20 years.

There is plenty of land available for new homebuilding in cities and suburbs. California cities are low-density. San Francisco, Los Angeles, and San Diego have one-fourth, one-eighth, and one-seventeenth as many people per square mile as Manhattan.

California government is refusing to address the crisis. Proposed subsidies cannot address the problem because demand is too large, housing is too expensive, and NIMBYism and greed — not lack of demand for homes — are the main problems. Local governments are currently able to reject new housing even when it complies with the rules.

California’s most important environmental law (CEQA) is being abused. CEQA allows multiple parties to sue anonymously after work on a project has been started and even completed. Most CEQA lawsuits are filed against projects in urban areas, and only 13 percent are filed by environmental groups.

 
 
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Solution

We need to triple the rate of building homes, apartments, and condos in cities and in suburbs by allowing modestly larger buildings. I support California YIMBY’s proposal to “up-zone” neighborhoods in walking distance of mass transit.  But alone it is not enough and would risk creating land speculation that could make housing prices even higher.

We must reform CEQA, our state’s most important environmental law. We must end anonymity in lawsuits to expose the corporations and labor unions seeking to harm their business competitors. We must end duplicative lawsuits like is done with class action lawsuits.

We should allow a modest amount of degraded farm and ranch lands to be used for housing. In the name of protecting the natural environment, California reduced the amount of agricultural land allowed for homebuilding to decline by half between 2002 and 2012. But cattle ranching reduces the biodiversity of California’s oak forests and increases carbon emissions. Cities and suburbs can support significant amounts of native and non-native species.

We need to be fair. Five times more of California’s land mass is used for ranching and farming than cities and suburbs. Ranch lands and farmlands can be beautiful, but California’s people also need decent shelter. It’s not fair that an industry that generates one percent of the state’s GDP should have five times more of the state’s land than places of human habitation.