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The California Housing Crisis: Where We Started and Where We’re Going

Updated: Sep 18


Having a safe and secure place to live is a basic human need, and the availability of housing at all income levels is critical to the growth and health of a city. Access to affordable housing, however, is becoming increasingly unattainable for many Americans. Last year, rates of chronic homelessness increased by 20%, nearly a million people were evicted, homeless camps continued to expand across the country, and about four million people spent three or more hours commuting because they were unable to afford a place to live close to their job.


The roots of the current housing crisis can be traced to the post World War II era, when the U.S. government initiated federal programs that subsidized new housing programs and expansive infrastructure systems for returning soldiers and the growing middle class. As manufacturing companies began to spread across the country, houses followed, leading to the development of (often segregated) sprawling suburbs of largely single-family homes. Government subsidies kept housing costs and development cheap, disproportionately benefitting white families and enabling them to buy and invest in the housing market.


In California, pro-growth economic policies enabled the population to increase from 6.9 million in 1940 to 15.7 million in 1960. This explosion in population and housing demands was at odds with a newly emerging anti-growth movement, which believed that the state’s growth had come too quickly. Through the late 70’s to the early 80’s, suburban anti-growth advocates began to establish bills and zoning ordinances at the local level that discouraged the development of affordable low-cost housing units and favored the construction of higher-cost (and lower-density) single-family homes.


The tech boom has worsened the situation in the Bay Area, as an infusion of cash in the local economy and a severely constrained housing market has sent housing costs skyrocketing and created an estimated shortage of 3.8 million housing units. More than anything, local zoning restrictions mandated by cities across the state, particularly ordinances that favor single-family housing (a practice historically linked with racial segregation), have stunted housing production and efficient land use in metropolitan areas where the housing crisis is most dire.


This crisis disproportionately impacts low-income state residents and communities of color. Due to housing supply shortages, waves of families and young professionals are unable to find housing, and end up moving to less expensive, often older, neighborhoods and developments. This prices out lower-income individuals who move into more crowded living conditions, move further away at the expense of longer commute times, leave the state, or even enter homelessness. This impacts the diversity of our communities, undermines household stability, and negatively impacts the local job market, making it harder to find employees to cover jobs at all income levels.


To solve the housing crisis, we must recognize that state and national involvement is necessary. Too much local control leaves housing policy choices in the hands of passionate homeowners who are incentivized to protect their investment - a home that has significantly appreciated in value - by preventing or severely limiting the construction of more and/or denser housing. This is especially true for families that have invested heavily in purchasing and upgrading their homes and view it as one of the primary wealth building strategies in their portfolio. And while expanding further out from the city center is a strategy that has been used in the past to meet housing demands, we must recognize that suburban sprawl increases vulnerability to wildfires, greenhouse gas emissions, and traffic from individuals with long commutes to the office.


As we look ahead, there is significant action being taken to address both the housing crisis in California and the restrictive power of local zoning ordinances. Bills like SB 886, AB 2097 and SB 9 represent substantial efforts to support and accelerate housing development across the state. SB 886, which was recently approved in the California state senate, aims to speed production of student and faculty housing on California state school campuses. AB 2097, if approved, will lead to significant reductions in parking requirements for housing developments near sites of high-quality public transportation hubs. And SB 9, which was passed in 2021, makes it easier to transition lots from single-unit developments to duplexes or subdivisions. This is a great start - but only just the beginning.


Our housing policy methods are undergoing a critical era of transformation. Expanding housing availability positively impacts many critical issues facing Americans, including economic security, health, climate change, and the racial wealth gap. Improving accessibility and supporting housing at all income levels ensures a future that is prosperous for everyone.


Additional Info and Resources


Books:

  • Golden Gates by Conor Dougherty

  • The Color of Law by Richard Rothstein

  • Homelessness is a Housing Problem by Clayton Page Aldern and Gregg Colburn

  • Evicted by Matthew Desmond

Publications:

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