“The average home in the United States costs around $240,000. But in San Francisco, the world’s most expensive place for construction, a two-bedroom apartment of what passes for affordable housing costs around $750,000 just to build,” writes Thomas Fuller for The New York Times.
California, once the land of milk and honey, has a dire housing shortage. A 2016 McKinsey Global Institute housing study concluded that California needed 3.5 million new affordable housing units by 2025 to accommodate both population growth and an already existing shortfall. Although Governor Newson has pledged to meet that goal, a new study by California Forward has suggested it might take longer – perhaps until 2050.
There are many components to the cost of building affordable housing. There is the value of the land and the cost of construction – in California both land values and construction costs are already higher than in most states. Added to this is the cost of government fees and permits as well as consulting companies required for the increased scrutiny that affordable housing attracts.
According to the Terner Center for Housing Innovation, a study in 2014 showed that local government requirements for the design of affordable housing increased the overall costs by an average of seven percent, and community opposition (which was measured by the holding of four or more community meetings) added another five percent to construction costs.
In San Francisco, after approval by the Planning Commission, permitting for a housing project can involve as many as eight different departments, each with their own individual requirements. In 2018, this has led to the appointment of a Director of Housing Delivery, Judson True, who is now responsible for streamlining this process and getting projects through faster.
Yet another problem is litigation. The California Environmental Quality Act allows anyone to object to a development project. In 1970, this was seen as a landmark event for environmental protection against reckless development, but today lawsuits brought by either environmental or citizen groups are commonplace and it is not unusual for a project in California to be tied up for years before ground is finally broken.
No truer words have been spoken than by Judson True: “Nothing this important should take this long or be this hard.”
Read the original article here.
Image courtesy of Jonathan Greene