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  • Archive for August, 2017

    Aug 25

    “THEY’RE BAAAAACK!”

    Posted by Crystal Whitfield | No Comments

    The California State Legislature is back from their Summer Recess, tan, rested, and ready, to finish out the final four weeks of the 2017 legislative year.  In addition to dealing with hundreds and hundreds of bills, Leadership has announced they are going to focus on a package of bills relating to affordable housing and are looking for ways to spend the windfall of cap-and-trade dollars.  As we push through to the final days of Session in mid-September it could be a wild ride.

    Aug 25

    AFFORDABLE HOUSING ISN’T AFFORDABLE ANYMORE

    Posted by Crystal Whitfield | No Comments

    Doing something – anything – to appear to address the affordable housing crisis is at the top of Legislative Leaders minds.   Housing is an incredibly important issue to our association and the lack of supply, inability to keep up with demand, and the increase in prices that come along with that, must be addressed.

    The median California home is now priced 2.5 times higher than the median national home.  Extremely high housing prices have caused home ownership in our state to tank – with just over half of California households owning their homes—the third lowest rate in the country. At the same times rents have soared.  Statewide, the median rental price for a two-bedroom apartment is $2,400, but the costs in urban areas can be more than double the statewide average.  Families are being priced out of certain market, are being forced to move further away from job-centers, and homelessness is increasing due to the lack of affordability.

    The reasons why California has gotten into this situation are many.

    The biggest driver for increases in housing costs is that the price of land, especially along the coast, had gone through the roof.  Regulations, lawsuits, labor shortages, increased material expense and labor costs, complicated land use laws, are all also pointed to by builders as reasons why supply has been choked off.

    Many in the legislature acknowledge privately that these reasons are, indeed, retarding development.  However, disentangling this Gordian Knot of issues will take a lot of political courage, force difficult policy discussion and decisions, and will take a level of give and take with powerful interests, that is currently not happening.  At this point the Legislature is focusing on measures that will focus some public money to affordable housing programs and an attempt at reform that may actually make the cost of construction more expensive in trade for a small modicum of regulatory relief.

    That is not to say we don’t support focusing funds on affordable housing programs, nor do we dislike incremental reforms to regulation, but we are concerned that there is not a more serious effort to address the core issues that have driven prices up so much.

    The CALmatters website has taken a look into the issue and lays out some basic facts about the issue that should be more widely understood.  We highly recommend reading this article by clicking here.

    Aug 25

    AFFORDABLE HOUSING BILLS

    Posted by Crystal Whitfield | No Comments

    Governor Jerry Brown and legislative leaders issued a statement on July 17 stating they were going to make affordable housing legislation a top priority for the final weeks of session.

    While the actual package of bills that will be included in the housing deal has yet to be formally announced, the Governor and leaders have insisted that new money for affordable housing will only be available if it is paired with streamlined regulations at the local level.

    There are three bills that have been mentioned the most as being part of this package:

     SB 2 (Atkins) Real Estate Document Tax: Imposes a tax of at least $75 on all recorded real estate documents which is re-directed to public affordable housing programs, emergency shelters, and transitional housing.

     SB 3 (Beall) Affordable Housing Bond Act of 2018:  A $3-$5 billion general obligation bond to fund public affordable housing programs and infill infrastructure projects including.

     SB 35 (Weiner) Affordable Housing Regulation Streamlining: Seeks to streamline multi-family housing project approvals by streamlining the approval process in exchange for agreeing to project-labor agreements (PLAs) which will trigger prevailing wage on private projects.

    We are working with our membership to determine how to move forward on this package of bills.  However, our industry remains opposed to the new taxes contained in SB 2 as the bill is a regressive measure that inserts a convoluted tax into the middle of day-to-day real estate business.

    Aug 25

    PREVAILING WAGE MANDATES INCREASE CONSTRUCTION COST BY 37%

    Posted by Crystal Whitfield | No Comments

    The Coalition for Affordable, Reliable and Equitable Housing issued the following statement after a new study revealed that prevailing wage mandates in private residential housing would result in $84,000 in higher housing costs:

    “In a time of unprecedented crisis – as communities of color and all Californians are struggling to regain their footing from the housing crash – we cannot afford any more expensive mandates that will starve people of being able to put a roof over their head. Prevailing wage mandates, perhaps will help some members of a politically powerful special interest, but that is only achieved at the expense of every other Californian currently struggling with higher housing costs. The bottom-line is prevailing wage will lead to higher poverty, higher housing costs and make our state’s housing crisis even worse,” said John Gamboa, Cofounder and President of California Community Builders and Vice Chair of the Two Hundred Project.

    The report, Impacts of a Prevailing Wage Requirement for Market Rate Housing in California, was funded by the California Homebuilding Foundation and conducted by Matthew Newman, former Executive Director for the California Institute for County Government and former Policy Analyst for the Legislative Analyst’s Office.

    The full report can be found here.

    Aug 9

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