Bay Area housing lags booming economy



With the Bay Area economy on fire and employment now matching the 2000 peak of the dot-com boom, regional leaders are concerned that housing lags.

That was the message issued Friday by the Association of Bay Area Governments in a new report that was the subject of a symposium at MetroCenter Auditorium in Oakland.

Titled “State of the Region 2015: Economy, Population, Housing,” the 84-page report offers a snapshot of the nine-county region: accelerating population and job growth in San Francisco, San Jose and Oakland as the Bay Area grows more urban and less suburban; the squeezing of the middle class; and not enough housing across-the-board, especially for low- and moderate-income households.

It adds up to a “sobering picture,” Cynthia Kroll, the advisory group’s chief economist, told the more than 100 government officials, business and community leaders who attended the symposium.

In many ways, the report elaborates on what has become a familiar picture.

With tight bank credit and low inventory, housing prices keep setting records at the high end, though low-end homes are still only halfway back to their bubble-era levels. Renters are in trouble: Almost half spend 30 percent of their income on housing, and about one-quarter spend half their income. In Santa Clara, Alameda and San Francisco counties, rent increases have been especially steep.

Where new construction is occurring, it skews toward multifamily homes: 4,029 permits were issued from 2010 to 2014 in Santa Clara County, which is adding far more multifamily units now than in the 1990s. At the same time, the report adds, single-family home production has dropped by more than two-thirds in the county.

The report also noted that the Bay Area, taken as a whole, is growing older. Marin is the oldest county. San Francisco is the youngest. T

And this was a surprise: While freeways are gridlocked, most people live in the county where they work. For those who commute across county lines, that generally means driving to the neighboring county.

The symposium was a freewheeling affair, with cries for innovation: more “densification,” meaning the clustering of new construction around urban centers and along traffic corridors; more construction of smaller units, including affordable micro-housing; and allotting more space for new units and less for parking.

“I think we have to embrace innovation,” said Meea Kang, president of Domus Development. “We live in the innovation capital. I do believe we’re going to build our way out of this.”

Participants noted the many contradictions of the region’s economy, where not everyone is benefiting. African-Americans and Latinos, underrepresented in the tech sector, are moving “further and further from job centers” as housing prices increase, said Lisa Feldstein, adjunct associate professor at San Francisco State. In Alameda County, she said, 24 percent of African-Americans live below the federal poverty line.

The Bay Area economy “may be about as hot as it’s ever been,” said Russell Hancock, executive director of Joint Venture Silicon Valley, who moderated a later session. “And the amazing thing is, it may be about to get hotter.” Yet he noted “the strange disappearance of the middle class. A boom in the tech sector is not necessarily a tide that lifts all boats.”

Article source: http://www.montereyherald.com/general-news/20150307/bay-area-br-housing-lags-br-booming-br-economy

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