Governor tackles housing crunch in California
UPDATE 9/29/2017 5:25 p.m.:
Gov. Jerry Brown has signed 15 bills to provide more money for affordable housing and streamline regulations that can stifle construction.
A long list of lawmakers and housing advocates lined up to cheer the legislation as a game-changer in California’s quest to provide enough housing at reasonable prices. But all say the issue is far from solved.
The $4 billion housing bond that serves as the key funding mechanism of the bills still needs approval from voters next year.
Brown says at the signing ceremony Friday in San Francisco that more work will need to be done in future legislative sessions to fully tackle the problem. California lacks an estimated 1.5 million affordable rental units compared to demand.
Industry insiders are cautiously optimistic, not knowing if voters will pass that $4 billion bond next November, but they believe it’s a step in the right direction.
“The amount of demand has gotten to an unbearable level that by the time this money is available, what will the demand look like? It will still be very significant and what will your construction costs be at the time?,” said Starla Warren, president and CEO of Monterey County Housing Authority Development Corporation.
Statewide, up to 90,000 affordable rental homes could be available in the next decade because of these laws.
However, the housing industry is facing other challenges.
According to HDC, construction costs have gone way up. It has seen a 77-percent hike in the last three years.
“I think that the demand surrounding our area, in the Bay Area, has created quite a bit of work for contractors, general contractors, sub-contractors,” Warren said. “So the demand is very high for firms right now and so consequently they can increase their asking price for work that you might have gotten two years ago. They may be getting 30-40% more.”
She went on to say while material costs haven’t gone up much, there’s not much available labor.
Over in Monterey, construction continues on multi-level apartment buildings on Lighthouse Avenue. The project is a 32-unit short-term housing for people who come to work for Montage Health.
When Montage Health announced the project back in June, a news release stated competition from other employers and an expensive real estate market are two of its biggest challenges in recruiting hard-to-find positions, and that too often, housing was a deciding factor.
“When people come into the area, supply is very limited and they can’t find housing close to the hospital,” said Greg Smorzewski, chief human resources officer for Montage Health. “So this is going to allow us to actually afford the opportunity to people who are in our difficult to fill positions, a nice place to live that’s close to our facility.”
The units will be ready for move in next year.
ORIGINAL POST:
Governor Jerry Brown has signed 15 bills to provide more money for affordable housing and streamline regulations that can stifle construction.
A long list of lawmakers and housing advocates lined up to cheer the legislation as a game-changer in California’s quest to provide enough housing at reasonable prices. But all say the issue is far from solved.
The $4 billion housing bond that serves as the key funding mechanism of the bills still needs approval from voters next year.
Brown said at the signing ceremony Friday in San Francisco that more work will need to be done in future legislative sessions to fully tackle the problem. California lacks an estimated 1.5 million affordable rental units compared to demand.
KION’s Mariana Hicks looks into what these laws mean for housing on the Central Coast at 5 and 6 p.m.
