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Greenbelt Alliance In the News

November 4, 2005

Group says Solano's 'affordable homes' aren't affordable to most Solano residents

Solano County's affordable-housing crisis is hidden because the county seems affordable compared with more expensive Bay Area counties, and because lots of homes are being built here, said Kate O'Hara of the Greenbelt Alliance. But local residents can't afford the new houses, she said.

"What is special about Solano County is it's often dubbed as the affordable part of the Bay Area, but we're seeing over and over again that it's not affordable to the people who live here," O'Hara said.

Linda Gunnerson, 48 and single, found that out three years ago during her search for a home. Gunnerson works for the Solano County Department of Child Support Services and makes about $40,000 per year. She wanted to find an affordable town house close to work. She found nothing.

"The houses I see going up around where I work are $500,000 with six bedrooms," she said. "Who needs six bedrooms?"

Gunnerson ended up buying a small two-bedroom house in Yolo County for $146,500. The commute is wearing on her, and she hopes to find a new job soon. Gunnerson is among the 80 percent of Californians priced out of their housing market, but she got lucky and bought a house in Yolo County before its boom started. Solano County's median priced home sold for $481,000 in September - a 25 percent increase over last year. The median household income here is $73,900, but residents need to earn $111,500 to afford the median price home. Fewer than 20 percent of the residents make enough to afford a median-priced home.

Plenty of homes are being built in Solano County, but only one-third of the needed affordable houses are being built, according to the report released Thursday by the Greenbelt Alliance and the Solano Housing Coalition.

The Housing Coalition's solution to the local affordability crisis is for each city to adopt an "inclusionary housing" ordinance. Such an ordinance would require developers to set aside a certain percentage of new homes to be sold at an affordable rate. The developers would absorb the costs as part of doing business with the city.

Solano County is growing at such a rapid rate that cities can act now to alleviate the affordability problem, said Evelyn Stivers of the Nonprofit Housing Association of Northern California.

"Solano County doesn't have to stay victim to the housing crisis," Stivers said. "It is within the power of the local government to create a more diverse housing stock." A recent Consumer Reports declared the Fairfield-Vallejo housing market the ninth most overpriced market in the country based on local family incomes and home prices. A home deemed affordable assumes people spend 30 percent of their total income on housing costs.

Fairfield kicked around the idea of an inclusionary housing ordinance for almost two years, but never passed a law. A city model proposed in 2003 would have required subdivisions of more than seven houses to set aside 7 percent of new homes for low-income home buyers and 8 percent for moderate-income buyers. Families would have to qualify by income for the housing and then couldn't resell it for a huge profit.

Fairfield Vice Mayor Harry Price said affordable housing is one of the City Council's biggest concerns. The theory behind inclusionary housing ordinances is good, but so is redeveloping existing housing, he said.

"The city of Fairfield has been very aggressive in providing a variety of housing stock," Price said.

In California, 117 cities and communities have inclusionary housing policies, according to the coalition's report. Davis and Petaluma are regional cities with inclusionary housing laws.

Charlie Carson, executive director of the Home Builders Association of Northern California, Northern Division, said inclusionary housing ordinances will drive up prices for market-rate homes and won't solve a city's affordable housing problem. "If some units are required to be sold below market rate price then they're sold at a loss to the developer," Carson said. "The market-rate units will have a higher price to reflect that."

California has an overall housing supply problem and cities won't solve the affordability problem by focusing on new housing, Carson said. They need to take a broad approach that involves the entire community, he said.

The Solano Housing Coalition plans to take a proposal to city councils and planners in the near future.

Reach Sarah Arnquist at 427-6953 or sarnquist@dailyrepublic.net.

Info
The minimum annual household income needed to purchase a median-priced
home ($509,000) in California in April was $120,290, based on an interest rate of 5.92 percent and assuming a 20 percent down payment.
Source: California Association of Realtors

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