Over the last few months, we spent some time discussing how everyone from economists to government officials have become increasingly concerned about the so-called housing crisis here in California.
Indeed, certain estimates show that the annual growth in the housing stock has been at least 100,000 units short over the last ten years of what is otherwise needed to satisfy both future and current demand. This housing shortage has proven especially hard for the Golden State's middle-class population, which earns too much to qualify for government subsidies, but too little to match the skyrocketing prices of residential homes.
The issue has not gone unnoticed by state lawmakers, who passed a package of bills aimed squarely at combating the housing shortage earlier this month.
What makes these bipartisan measures so impressive, say experts, is that they strike the necessary balance of increasing funding while also facilitating the growth of new building projects.
The legislative package is composed of the following bills:
- Senate Bill 3: Calls for voters to be presented with the opportunity to approve a $3 billion housing bond to fund existing state housing programs in November 2018, such that the costs typically serving to deter builders from pursuing below market rate projects would theoretically be offset.
- Assembly Bill 74: Calls for rental assistance to be provided to chronically homeless residents, with proponents arguing that providing people with a place to live serves to drastically reduce public costs associated with homelessness.
- Senate Bill 35: Calls for relaxing approval procedures relating to housing development, such that these projects could move forward without reviews under the California Environmental Quality Act and public hearings provided they are located in areas that haven't met state housing goals and still subject to local oversight.
It will be interesting to see if this legislative package gains the necessary momentum, such that residents see their options expand considerably and, by extension, builders see their profit opportunities expand considerably.
Stay tuned for updates …
If you are a builder or developer looking to capitalize on projects, you should strongly consider consulting with a skilled legal professional attuned to both the unique concerns and complex issues present in the construction industry.