Laserfiche WebLink
99 percent in the fastest growing urban counties <br />throughout the country (top fifth of all urban <br />counties). As figure 2 shows, over the same time <br />period rents paid by low-income households grew <br />nearly three times faster in California’s coastal <br />urban counties than in the fastest growing urban <br />counties (50 percent compared to 18 percent). <br />As a result, the typical low-income household in <br />California’s costal urban counties now spends <br />around 54 percent of their income on housing, <br />compared to only 43 percent in fast growing <br />counties. This difference—11 percentage points—is <br />roughly equal to a typical low-income household’s <br />total spending on transportation. <br />Lower Costs Reduce Chances of Displacement <br />More Private Development Associated With <br />Less Displacement. As market-rate housing <br />construction tends to slow the growth in prices <br />and rents, it can make it easier for low-income <br />households to afford their existing homes. This <br />can help to lessen the displacement of low-income <br />households. Our analysis of <br />low-income neighborhoods <br />in the Bay Area suggests <br />a link between increased <br />construction of market-rate <br />housing and reduced <br />displacement. (See the <br />technical appendix for <br />more information on how <br />we defined displacement <br />for this analysis.) Between <br />2000 and 2013, low-income <br />census tracts (tracts with an <br />above-average concentration <br />of low-income households) <br />in the Bay Area that built the <br />most market-rate housing <br />experienced considerably less <br />displacement. As Figure 3 <br />(see next page) shows, displacement was more than <br />twice as likely in low-income census tracts with <br />little market-rate housing construction (bottom <br />fifth of all tracts) than in low-income census tracts <br />with high construction levels (top fifth of all tracts). <br />Results Do Not Appear to Be Driven by <br />Inclusionary Housing Policies. One possible <br />explanation for this finding could be that many <br />Bay Area communities have inclusionary housing <br />policies. In communities with inclusionary housing <br />policies, most new market-rate construction is <br />paired with construction of new affordable housing. <br />It is possible that the new affordable housing <br />units associated with increased market-rate <br />development—and not market-rate development <br />itself—could be mitigating displacement. Our <br />analysis, however, finds that market-rate housing <br />construction appears to be associated with <br />less displacement regardless of a community’s <br />inclusionary housing policies. As with other <br />Bay Area communities, in communities without <br />inclusionary housing policies, displacement <br />Places With More Building Saw <br />Slower Growth in Rents for Poor Households <br />Rents Paid by Low-Income Households in Urban Counties (In 2013 Dollars) <br />Figure 2 <br />200 <br />400 <br />600 <br />800 <br />1,000 <br />1,200 <br />$1,400 <br />California Coast U.S. Counties With Most Home Building <br />1980 <br />2013 <br />Graphic Sign Off <br />Secretary <br />Analyst <br />MPA <br />Deputy <br />ARTWORK #160020 <br />Template_LAOReport_mid.ait <br /> www.lao.ca.gov Legislative Analyst’s Office 9 <br />AN LAO BRIEF 8.A - Page 17