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New Momentum Toward Solving California’s Housing Crisis
New Momentum Toward Solving California’s Housing Crisis
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Despite the passage of Senate Bill 9 and Senate Bill 10 earlier this year – both of which removed restrictions on building and renting small apartments, primarily in job-rich areas or locations near mass transit – California remains in the grip of a severe housing shortage.
The median price for a single-family home in the state passed $800,000 in 2021, and nearly 40% of residents are considered “housing cost burdened,” meaning that at least 30% of their income goes to rent or home ownership-related expenses. Only around 58.8% of Californians currently own homes, among the lowest rates in the United States, and an estimated 100,000 state residents lack permanent housing altogether.
Efforts to expand new affordable housing construction have repeatedly been stymied both by local governments. That's because many of them are beholden to their (often home-owning) constituents and communities' concerns about what more construction might mean for their property values and the character of their neighborhood. Those concerns take the form of everything from complaints that “the need for more housing has been overestimated” to half-serious claims that “the area must remain a sanctuary for mountain lions.”
But over the past several sessions, Sacramento has taken the lead in advancing bills to address the lack of housing, including changing local zoning regulations, and stepping up their enforcement of those laws.
Over the past month, a new slew of state housing bills (outlined in this helpful Reddit thread) has passed the Legislature. They include eliminating mandated minimum number of parking spaces for housing near Metro stations, legalizing residential construction in commercial zones statewide, streamlining the approval process to build new public housing and exempting student housing from some aspects of the California Environmental Quality Act (CEQA). That last one sounds a bit questionable, sure, but it’s actually in response to a loophole – allowing any member of the public to file a CEQA lawsuit – that has been used by NIMBYs to delay construction of housing projects of all types. (Half of new housing going up in California now faces CEQA lawsuits.)
State officials argue that California needs to build around 310,000 new housing units each year, over the next eight years, in order to make up for current shortfalls. That’s a lot of new housing. And it will require new and creative approaches if the state is even going to get close to reaching this goal. Fortunately, a number of local startups are focused on technological innovations that could help improve our housing issues.
Culver City-based Azure Printed Homes, for example, manufactures 3D-printed units that can serve as backyard studio apartments or so-called Accessory Dwelling Units (ADUs) in just 24 hours. Rialto’s Plant Prefab also aims to simplify new home construction. The company is fundraising now to build a third highly automated factory to produce its prefabricated homes, which reduce construction times by 20-50% over conventional methods. Yet another Culver City-based company, United Dwelling, helps homeowners convert their garages into separate studio homes, which can then be rented out to tenants.
Ideas extend beyond new home construction as well. Yesterday, we briefly discussed Sunnova Energy, a solar panel installation company that now aims to become a “micro-utility,” selling power directly to homes in new residential developments. Increasingly, these kinds of projects – buoyed by Sacramento’s more aggressive approach to increasing housing – could play a key role in getting more Californians inside homes and apartments they can afford. — Lon Harris
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