is leaving California families locked out of homeownership and contributing to persistent homelessness, says RAND economist Jason Ward.
Rapidly escalating home prices now exclude most Californians from having any realistic path to homeownership. It has also raised the stakes for existing homeowners to oppose anything that threatens the huge valuation of their homes, be it a new multifamily building next door or anything that might, say, increase traffic or change a view or potentially affect anyone’s perception of the value.
And we haven’t done anything to address the flow of people into homelessness due to very high housing costs. We will never solve homelessness in a setting where it costs $2,000 to $3,000 per month to rent a basic one- or two-bedroom apartment and you need a $4,000 to $6,000 security deposit to even have the opportunity to try to pay those rents.
I think in some sense, we’ve kind of done that in California already. We’ve made this a much less desirable place to live. Even college-educated people are now beginning to migrate out of California. Q: Under Senate Bill 9, California property owners can subdivide lots in single-family neighborhoods and build up to four units on those parcels. Is that having an impact on the housing shortage?It has yet to have any meaningful impact, and I do not believe it will until we remove exclusions that prevent professional builders from using this pathway.