Low-Income Californians Struggle to Find Affordable Housing

A new study from the California Housing Partnership Corp. attributes rising cost of rent and decreasing government aid for a lack of affordable housing available for California’s low-income residents.

California Struggles to House Low-Income Families

The report also found that almost a million extremely low-income households in the state are without cost-effective, livable homes, a need that is highly pronounced in Los Angeles and the rest of Southern California. While the foreclosure crisis displaced many California homeowners, it also raised demand as well as prices within the rental housing market. Once the housing recovery came into full swing, prices for home prices skyrocketed.

However median incomes, which fell 8 percent from 2000 to 2012, have been unable to keep up with the state’s median rent, which has increased more than 20 percent, reports the California Housing Partnership Corp. Additionally, state and federal funding for below-market housing has dropped 79 percent over the last five years according to the study.

“It’s creating a rapid change in our housing stock — away from providing affordable, low-income housing toward housing the rich,” said Matt Schwartz, president of the California Housing Partnership, in the Los Angeles Times.

Ways to Increase Affordable Housing in Los Angeles

Many low-income households are unable to tap into a substantial savings account for purchasing a home, creating an urgent need for affordable housing in Los Angeles and the rest of the state. A big blow to housing affordability was the loss of redevelopment funds after local redevelopment agencies were shut down two years ago by the state government in an effort to ease the budget crisis. The redevelopment agencies generated about $1 billion each year for affordable housing throughout the state of California, while keeping a chunk of local property taxes.

The California Housing Partnership proposed numerous policy recommendations to alleviate housing burdens for Californians, such as a prompt influx of money from the general fund to concentrate of housing residents considered at-risk of homelessness due to soaring rent costs.

The report from the California Housing Partnership also recommended that the state Assembly should pass a bill that would establish a perpetual state fund for affordable housing. While the bill passed last year by the state Senate, it has yet to pass the state Assembly and has drawn resistance from the California Association of Realtors since it would levy additional fees on recorded real estate documents, except for those involved in a sale.

“In a state where housing affordability is low, the last thing government should do is to enact an arbitrary new real estate tax on real estate recordings,” the California Association of Realtors said in a statement. “The call for renewed support for affordable housing is laudable, but Senate Bill 391 is the wrong approach.”

Photo credit: Pintaric via Wikimedia Commons