Silicon Valley housing shortage worsens for lowest-income earners
The San Jose City Council voted to commit funds to three different affordable housing projects, including one on Page Street in San Jose, above. Photo courtesy of San Jose Department of Housing.

    Only 22 out of every 100 households in California’s lowest income bracket have access to available and affordable housing, according to the most recent annual report by the National Low Income Housing Coalition.

    That means the state’s poorest people can’t find a place to live — something which the report points out is a pattern across the country.

    While California has a major shortage of affordable housing, the report shows California is among the worst states with available housing, sharing the bottom of the list with Nevada, Delaware and Oregon.

    “The shortages of affordable and available rental homes disappear for households higher up the income ladder,” the report says. “Every state has a shortage of affordable and available rental homes at the very low income threshold of 50% of AMI, 20 states have a shortage of housing at 80% of AMI, and just seven states have a shortage at median income.”

    The report shows that California is short 1,019,190 homes for extremely-low income level renters, with more than 76 percent of those at this income level being “households with severe cost burden.” The report says those are individuals at risk of sacrificing things like healthy food and healthcare to pay their rent.

    “I think this report illustrates the fact that our housing crisis is most severe for our low-income earners and the gap between supply and demand is the greatest when you look at extremely low-income housing,” said David Low, spokesman for Destination: Home. “When there is that huge of a gap, it provides huge strains on our community, particularly for people who may be on the verge of homelessness.”

    In the Silicon Valley region, characterized by the report as “San Jose-Sunnyvale-Santa Clara,” 70 percent of those in the extremely low income bracket are severely cost burdened, meaning they’re spending more than half of their income on housing.

    Only 31 out of every 100 households in this income bracket can find an affordable place to live. According to city data, San Jose has only 12,706 affordable housing units in San Jose, as of Aug. 2018.

    Low said by investing in and building more housing in San Jose, “we can not only address the greatest need in our housing inventory, but we can also ensure that more units are available to help respond the homeless crisis.”

    The San Jose City Council will soon discuss expansion of affordable housing funding during its upcoming April 9 meeting, as part of a new Housing Investment Plan. In a memo, San Jose Housing Director Jacky Morales-Ferrand recommends the city first prioritize “acquisition and/or rehabilitation of existing market-rate housing” by allocating $10 million for such development. Second, the memo reads, the city should spend no less than 30 percent of its housing funds on housing for the city’s lowest-income residents.

    In a letter to the City Council, Destination Home CEO Jennifer Loving urges lawmaker to “be even bolder” and instead allocate 50 percent of its housing funds to low-income affordable housing.

    “We must ensure that our limited affordable housing dollars go where the need is the greatest,” Loving wrote.

    Morales-Ferrand addressed budget concerns in her memo, writing that “over $520 million in funding is necessary to fund the gap of 4,229 units to meet the goal of providing 10,000 affordable units.”

    Graphic by Grace Hase

    The memo points out that the Housing Department has $176 million available to finance 1,412 new affordable deed-restricted apartments over the next five years, based on the maximum funding limit of $125,000 per apartment.

    “In addition, the Housing Department will modernize its affordable housing dispersion policy to guide where City-financed affordable development will occur,” Morales-Ferrand wrote. “This policy would help ensure that affordable housing is distributed throughout the city, particularly in areas with access to high quality transit, job centers, parks, libraries, quality schools, and other amenities.”

    Reporter Grace Hase contributed to this report.

    Contact Kyle Martin at [email protected] or follow him @Kyle_Martin35 on Twitter.

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