How much affordable housing does LA need?

Los Angeles County has an extreme shortfall of affordable housing, according to a new report from the California Housing Partnership and the Southern California Association of Nonprofit Housing, and 568,255 new units are needed to satisfy the demand of lower-income renters.

Based on Census data, the report indicates that more than 800,000 renter households would qualify for affordable housing, were it available. But fewer than 300,000 units are available across the entire county at rents that would be affordable to these residents.

That means most lower-income renters are stretched thin by monthly payments that take up a huge portion of their budgets. Households earning less than half the median income, spend more than 70 percent of their income on rent, leaving little money left over for essential needs like food and healthcare.

The association’s director, Alan Greenlee, tells Curbed that statistics like this challenge the idea that Los Angeles is a place where “you can make a living and afford your house and send your kids to school.”

He argues that high rents don’t just make it hard for lower earners to make ends meet; they also hamper the region’s overall economy.

“When you’re spending so much of your income on rent, that money’s going to landlords instead of grocery stores,” says Greenlee.

Compounding the problem in the short-term is a steep decline in the number of affordable units produced using low-income housing tax credits in 2017.

Greenlee says the 54 percent dip in development of these units between 2016 and 2017 is probably due to uncertainty on the part of investors about how federal tax reform would affect the value of those tax credits—relied on by developers for many affordable projects.

Because the value of low-income housing tax credits has increased in recent months, affordable housing production might pick back up again. But that won’t be enough on its own to close the gap between needed and existing housing.

The report offers several policy recommendations for addressing this issue, including increased spending at the state level and passage of a $4 billion bond measure for affordable housing that California voters will decide on this fall.

Its authors also recommend that state lawmakers find a way to return financing systems to cities that could pay for projects similar to those taken on by the now-shuttered community redevelopment agencies.

On a more local level, county and city officials could offer new renter subsidies, eviction protections, and a streamlined development process for affordable housing (similar to the system now in place for permanent supportive complexes built for homeless residents).

Greenlee says that higher earning residents should get behind policies that lead to more affordable housing production.

“Intellectually, I think that people understand that it costs a lot to live here,” he says. “But there still continue to be misunderstandings about people who happen to be poor—there’s a perception that it’s somehow those people’s fault.”

He speculates that those feelings sometimes manifest themselves in opposition to new development, which can exacerbate the area’s existing housing shortage.

“There’s a lot of education and growth that needs to happen in our community,” Greenlee says. “But we gotta build.”