In the Southern California region, there is a broad choice of housing ranging from very affordable to very expensive. Generally, multifamily rental housing, including mobile home parks, are considered to be affordable housing. However, the closer the apartments or mobile home parks are located to the beach or other desirable neighborhoods, the more expensive they are. Likewise, the farther inland or in less desirable neighborhoods, the less expensive all forms of housing become. The very same 800 square foot 1940’s bungalow located in San Bernardino will rent for a mere fraction of what it rents in Newport Beach. The real estate adage, “location, location, location” applies to all forms of housing.
Generally multi-family rental housing is considered affordable housing and mobile home parks are included in that category. It is important to note that there is a big difference between “affordable housing” and “low-income housing.” Affordable housing is available to everyone as a lifestyle choice, regardless of one’s income. It is very common to find people choosing to live in a nice apartment community or mobile home community because they like the lifestyle. It has nothing to do with whether they could afford to live in a larger or more expensive house.
Low-income housing is another type of housing entirely. To address the needs of low-income families, government has provided a variety of programs including Section 8 rent subsidy programs and other subsidized housing. To live in a subsidized low-income apartment or condominium the renter or purchaser has to meet the low-income criteria.
Cities are required to adopt housing elements identifying the types of housing in their communities. The number of single family homes, condos, apartments, mobile home parks and subsidized low-income housing is outlined in these housing elements. Many cities and counties have adopted zoning requirements that require developers to include affordable housing within their housing developments or to pay the jurisdiction a fee for affordable housing.
Apartments and mobile home parks are not low-income housing. They provide a rental housing choice that, depending on the location, can also be an affordable housing choice.
Sometimes it seems as though affordable housing is hard to find and rents seem to be on the rise. Of course, the term “affordable” is subjective to begin with and it is easy to point the finger at the “greedy landlord”, but what is truly behind the lack of affordable housing and what is affordable housing?
First there is government regulated affordable housing, which limits the price of the housing (sale price or rent) and the income of the people who purchase or rent the “affordable” unit. There are cost and income controls on these units. Government may build these units and private developers may build them in exchange for various incentives. In California every city that had a redevelopment agency had to set aside funds to build affordable housing for low-income buyers and renters.
Other types of housing that are generally referred to as affordable are privately owned properties that are not regulated by government. Apartments in some areas generally fall into the “affordable” housing category because they do not cost as much as a site built homes in the area and because there are no requirements to put down a deposit and to qualify for a home loan – i.e. apartments are more “affordable”.
Overall, there are some general reasons why there seems to be a lack of real affordable housing (requiring restrictions on costs and incomes) to rent and to purchase. As an example:
- Lending for affordable housing is scarce. Most lending institutions will not provide funding for such projects, this means developers must turn to private investors who with the current economic state are holding onto their pockets very tightly.
- The permitting process is long and clouded. Not only must they pass all required inspections, Affordable housing projects must move through a public input process before permits can be granted.
- Zoning restrictions may also impede affordable housing development. Many areas are zoned for other uses and it takes time and a lot of maneuvering through red tape in order for land to be re-zoned.
- Some cities have an affordable housing budget but it is not being utilized. San Francisco will have an estimated $20.6 million in affordable housing fees as of June 30, 2013. That is enough to finance up to 4,000 affordable housing units. Only 106 have been completed, 70 are under construction.