Dive Brief:
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California Gov. Jerry Brown has called for a reduction in red tape and delays in order to lower costs and increase the construction of affordable housing, according to the San Francisco Business Times.
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As part of a state spending plan for the next fiscal year, Brown called for a raft of legislation that makes it easier to build new homes, including streamlining the permitting process and introducing incentives for local governments to meet housing requirements.
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Brown's renewed call follows failed attempts last year to garner enough support for a plan that aimed to raise $400 million for affordable housing and cut back on local environmental reviews.
Dive Insight:
California is currently in the throes of a housing crisis as inventory levels have failed to keep pace with firming demand, forcing prices skywards.
Last week, a report by the state’s Department of Housing and Community Development found that housing production in California came up more than 100,000 new homes short annually over the last 10 years to keep up with demand amid rising population levels, with lower income residents in the state facing the most challenges impeding homeownership.
Pressure is not expected to subside in the near-term, with the HCD report also forecasting the state’s population to reach 50 million by 2050, up from 39 million currently.
The spike in demand and prices led California to top Realtor.com’s monthly list of the hottest housing markets, with San Francisco taking the No. 1 spot and Vallejo, CA, San Jose and San Diego in the top five.
A lack of supply is forcing state legislators to put forward proposals aimed at tackling the crisis, with lawmakers currently considering a bill that would see Californians who own a second home losing the ability to deduct interest on that mortgage from their state taxes.
In San Francisco, voters last summer cleared the way for a ballot measure requiring residential developments with 25 units or more to offer 25% at below-market rates, up from the previous requirement of 12%.
