According to local developers, new home sales continue to be strong, a sign of our bustling economy. Yet a very different picture of the real estate market is being drawn by a recent industry study.
The California Association of Realtors reported last week its housing affordability index, which measures the percentage of California households that can afford buying a median-priced home, dropped a staggering 9 percent, from 42 percent in January 1999 to 33 percent this year.
That’s the largest drop in the index since July 1989, when it also dropped 9 percent and ushered in a real estate recession.
For San Diego, the percentage of families able to afford their own homes is even less than the statewide average, dropping from 36 percent in January 1999 to 27 percent this year , the fifth lowest percentage in the state. By comparison, the national affordability index is 54 percent.
This, of course, is more than a passing trend. California is second to last in the nation for home ownership, with only 56 percent of California households able to own their own residence compared to nearly 67 percent nationally.
This is already presenting difficulties for California firms seeking new employees.
According to Allan Zaremberg, president of the California Chamber of Commerce, California companies are finding between 60-80 percent of the people they attempt to recruit from out-of-state are saying “no thanks” due to the cost of housing here.
This “jobs-housing imbalance,” as it’s called, will only get worse as the state’s population mushrooms to between 45 and 50 million in the next two decades.
The seriousness of this problem has brought together a broad coalition of business, labor, housing advocates and legislators to promote an omnibus package of bills aimed at correcting the job-housing imbalance.
If entirely approved by the state Legislature, the “Job Center Housing” package would strive to make housing more affordable in California by:
– Providing fiscal awards for communities in job-growth areas for approving new housing.
– Stopping the abuse of the state’s environmental quality laws to stall or kill housing projects.
– Establish a fair system for resolving construction disputes.
– Establish full disclosure of the impacts of local growth control initiatives.
– Promote more timely and efficient use of redevelopment funds.
– Identify obstacles to greater investment and housing development.
– Increase funding for low- and moderate-income housing.
Without affordable housing, California’s economic balloon will surely burst. When it does, we could see another mass exodus of businesses and workers from the state as we did not quite a decade ago.
We urge support for the “Jobs Center Housing” legislative package.
, Martin Hill