James Pappas, Housing Policy and Preservation Associate

California Housing PartnershipSCANPH Webinar

03/17/2014

California Housing Partnership Corporation is a 25 year old private, nonprofit organization created by the state of California to monitor, protect, and augment the supply of homes affordable to lower-income Californians and to provide leadership on affordable housing finance and policy. Since 1988, California Housing Partnership has assisted more than 200 nonprofit and local government housing organizations to leverage morethan $5 billion in private and public financing to create and preserve 20,000 affordable homes.

• Nearly 1 million ELI households do not have access to an affordable home.

• Median rent in California rose over 20% from 2000 to 2012 while income declined by 8%.

• The percentage of low-income renters who pay more than 50% of income in rent continues to grow.

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San FranciscoSan JoseOakland

Orange CountySan Diego

Los Angeles

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• ELI households are the most vulnerable residents of the state. More than 50 percent of ELI households are elderly or disabled.

• VLI households are more likely to include low-wage workers. In fact, hundreds of thousands of workers throughout the state earn less than half the state’s median household income or less than $28,510.

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• 46% of Californians rented their homes in 2012, compared to 42% in 2006.

• The number of renter households increased by over 700,000 while homeowner households decreased by over 300,000

• Increased demand in the rental market has driven up median rents.

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Number of Renter Households vs. Owner Households in LA County

2000 2006 2012

Household TypeNumber of Households % of total

Number of Households % of total

Number of Households % of total

Renters 1,634,030 52.1% 1,607,392 50.7% 1,750,538 54.2%

Owners 1,499,744 47.9% 1,564,640 49.3% 1,481,122 45.8%

Source: 2000 Census, 2006 1-year ACS, 2012 1-year ACS

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• In 2013, the median rent in California was $1,550 while the average renter wage was estimated at $17.99/ an hour.

• The average renter would need to work at least 66 hours a week year round in order to afford that rent.

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• In September 2013, the median sale price of a single-family home in California was $428,810, a 75 % increase from the bottom of the market in 2009.

• Assuming that the average renter earning $17.99 an hour could put 10 % down and qualify for a 4.5 % interest mortgage, she would still have to devote over 60 percent of her income to afford home ownership.

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According to the Supplemental Poverty Measure, 23.8% of Californians (8,952,000 people) are living in poverty – by far the highest percentage and number of any state.

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According to the California Poverty Measure, another alternative to the official poverty measure that accounts for cost of living, including housing, and government assistance, LA County has 26.9% of its population living in poverty- the most of any county in the state.

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• The elimination of Redevelopment Agencies in 2012 led to the loss of more than $1 Billion annually in funding for affordable housing

• State housing bond funds from Propositions 46 and 1C will likely run dry by 2014 resulting in the loss of nearly $400 million annually

• Recent cuts in federal housing funds have lead to the loss of another $200 million annually

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Funding dropped by $2 billion or 79%

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Funding dropped by at least $300 million – not including the exhaustion of state bond funds

Changes to LA County's HUD and Redevelopment Affordable Housing Funding Sources

FY 2007/08 to FY 2012/2013

2007/2008 2012/2013 % Change

CDBG $158,341,788 $110,275,258 -30%

HOME $75,878,411 $36,267,516 -52%

Redevelopment $251,148,877 0 -100%

Total $485,369,076 $146,542,774 -70%

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1) Replace the exhausted state housing bonds(Propositions 46 and 1C) by:

•Passing the Homes and Jobs Act (SB 391)• $500 million per year for affordable housing

•Making an immediate General Fund investment in the state’s existing rental housing production programs.

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2) Invest a significant portion of Cap-and-Trade auction revenues in HCD’s existing TOD program

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3) Give local governments tools to replace lost funding and comply with SB 375 obligations to create and preserve affordable homes by:

•Lowering the required voter threshold to 55% to approve funding for basic infrastructure including transportation, housing, and parks.*

•Authorizing a tax increment financing (TIF) program that gives local governments the ability to fund the development of infrastructure including transportation, housing, and parks.

•Allowing local jurisdiction to require inclusion of a percentage of homes affordable to low- and moderate-income households in new housing development by passing into law a new version of AB 1229, which the Governor vetoed in 2013.

California Housing Partnership Corporation

James Pappas, Housing Policy & Preservation Associate jpappas@chpc.net or 415-433-6804 x320

Megan Kirkeby, Sustainable Housing Policy Managermkirkeby@chpc.net or 415-433-6804 x 319

Matt Schwartz, President & CEOmschwartz@chpc.net or 415-433-6804 x 311

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