Staff is cynically using “affordable housing” as an excuse for the council to mandate more big development

 

Naturally, there’s no mention here of possibly imposing citywide rent control or apartment unit set-asides to realistically address this problem.

Instead, it’s only about building lots more apartments in Burbank and even more new condos — which will only raise and not lower our existing rents.

RECOMMENDATION
This affordable housing study session is an opportunity for the City Council to discuss the need for affordable housing in the community. The goal is to develop a strategy for affordable housing production that is responsible and appropriate for the Burbank community.

BACKGROUND
There is a housing crisis across the state, region, and in Burbank. The median sales price for an existing home in Burbank is $725,000, an increase of 6.7 percent from $679,000 since 2015.

At the same time, apartment rental prices are rising faster than household incomes. The current median rent price for a two-bedroom unit in Burbank ranges from $1,850 to $2,504, according to the latest rent data. As rents increase, so has the housing cost burden for households in Burbank. A total of 9,720 Burbank households, or 24%, are severely burdened by housing costs.

In other words, almost 10,000 households pay more than 50 percent of their income on housing costs. Finally, housing supply has not kept up with population growth. Recent demographic estimates show that about 108,000 persons live in Burbank, and the daytime workforce population is almost 150,000 each work day.

Our community does not have housing to accommodate the large number of highly paid workers, let alone affordable housing options for lower and moderate income households. Most of Burbank’s workforce travel to work here every day, shop and dine in Burbank, volunteer with Burbank non-profit organizations (some may sit on their boards), and some send their children to Burbank schools. Yet many who would choose to live in Burbank cannot be accommodated because there is a limited supply of housing. This is particularly problematic for low and moderate income families. In the last two years, only 33 units were produced in the City…

Especially when the city so easily allows people like the Cusumanos to knock down our more affordable  older apartments in order to make room for their tacky dream projects.

In addition to lack of housing options for the Burbank workforce, current residents in rental housing have faced rent increases greater than 10%, sometimes as high as 30%, and at times doubling in the last 12 months. Staff receives numerous calls weekly, and the Landlord Tenant Commission meets regularly with tenants and landlords to mediate and assist with negotiating these rent increases. To make ends meet, studies show that households have to share an apartment or single family home, and many households have to ultimately move out of Burbank sometimes uprooting children from school.

Gee, too bad there’s no solution to our raising rent problem.

DISCUSSION

As stated earlier, this discussion is an opportunity to lay out a housing strategy for current Burbank households and the Burbank workforce. The workforce travels across our community, their children are already in our schools, and services in Burbank will continue to serve them as long as the workforce is employed in our City. The “real cost” of not housing our workforce and current residents with affordable housing options relative to each household need, is displacement of long-time residents and overcrowding in the units we do have. About 2,400 Burbank households live in over-crowded units.

Naturally, here’s staff’s chosen recommendation:

LACK OF HOUSING PRODUCTION

Studies show that the housing crisis can be primarily attributed to: 1) lack of housingproduction overall; and 2) lack of units available and affordable for all income levels. SCAG summarizes what is “holding up” housing production in the following manner:

1) Lack of Funding – Many jurisdictions do not have permanent funding to build housing. Subsidized housing may not produce enough revenue and other forms of land use may be preferred;

2) Regulatory Barriers – There are a number of development requirements that can delay or stop a residential project. These requirements can also add to the cost of a project; 3) Local Zoning Requirements – These requirements, such as development standards, can restrict the number of units or render them unaffordable for many; and

4) Resistance to Development – Misinformation and possibly miscommunication can lead to community opposition to residential projects.

Build more buildings!

“AFFORDABLE” HOUSING NEED

What is affordable housing? It is critical to understand there is a need for “affordable” housing for all segments of the live and work population. This is much different than the traditional understanding of affordable housing only for lower-income households. The table on the following page summarizes the make-up of the current Burbank community.

And here’s their suggestions for discussion:

What are Burbank’s options? As a community, do we:

1. Allow the development of housing?

2. Require low-income housing units in all market-rate projects?

3. Implement low-income housing fees for small residential projects and all commercial projects?

4. Encourage development of second dwelling units in single family residential zones?

5. Contribute funding to developments that follow City Council’s goals and policies?

6. Utilize the Housing Authority’s power of eminent domain to assemble properties?

7. Utilize City-owned properties if/where appropriate?

8. Continue to work with representatives at the state level to create permanent funding source for housing? These are only a few goals and options to begin the conversation. The longer list of ideas for the creation of affordable housing in the community, along with the pros and cons of each, is included in Exhibit A.

Again, this study session is an opportunity for the City Council to: 1) Discuss ways to accommodate and even encourage affordable housing production; and 2) Direct staff as to which strategies may be preferred for affordable housing production that is responsible and appropriate for the Burbank community.

No, it’s an “opportunity” for them to validate large-scale development in Burbank. Which will do NOTHING to lower our local housing costs, especially for tenants. More new buildings will make the prevailing rents go up.

Sure, if 10,000 new units suddenly hit the local market it might depress it enough to temporarily drop the asking price on apartment rentals (which would never happen for those current tenants who already have a place). But they’d all quickly go right back up, especially in the absence of rent control!
 
 
 

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17 Comments

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17 responses to “Staff is cynically using “affordable housing” as an excuse for the council to mandate more big development

  1. Somebody clearly doesn’t understand basic economics.

    • semichorus

      Somebody clearly doesn’t now how the real world works. There is no such thing as a “free market” for housing.

      It’s a closed market.

  2. Anonymous

    Agreed… Somebody clearly doesn’t understand basic economics.

    This idea that housing is a closed market is just hand-in-blender stupid.

    You know rent control is outlawed in almost all states, right?

    There’s plenty of affordable housing right around Burbank, in N.Hollywood, Sun Valley, etc… Just a few miles away… Let them drive 5 miles into town to work here.

    • semichorus

      Ha! And who gives a damn what redneck states do?

      Apartment housing’s a closed market because people can’t walk away from their housing needs. They’re stuck with paying it, and landlords exploit this fact every day.

      Here’s more proof that it’s not a real “market”: when apartment vacancies go up — which HAS happened in the past — how come landlords NEVER lower a current tenant’s existing rent?

      When has that EVER happened? “Guess what tenant, the market’s down and so I’m lowering your rent…”

      And how come “rent” costs bear no relationship to a landlord’s expenses? What other business offers such an unjustifiable obscenity, and why too do landlords get to “depreciate” their always rapidly appreciating properties?

      Pity the poor landlords, yes — they were all forced into this lucrative business. Rents should be regulated just like utilities.

    • Well no there’s actually not enough affordable housing in Burbank. We’ve been underbuilding for decades and now have a chronic shortage of housing, not just in Burbank, not just in LA, but in the entire state of California. This is a direct result of NIMBYism that got neighborhoods downzoned and passed anti-development propositions like prop U in LA, and measure one in Burbank. http://www.abundanthousingla.org/2015/10/21/los-angeles-used-to-be-a-city-where-everyone-could-find-housing-at-a-reasonable-cost/

      • semichorus

        Nonsense. Burbank has had lots of building. There’s also plenty of population density for its five or so square miles. We’re not Bradbury or San Marino.

        So Burbank has no moral or practical responsibility to “provide more housing” to people. We have PLENTY for a town of our size. That’s just pretext to allow developers to turn the place into a cash cow. More new apts will also make rents go up, not down.

        I DO think we should have more back houses in town (SDUs), which of course will make you landlords and friends of landlords go positively apeshit over the competition. “Oh no, not SDUs!”

        Too bad. Their proposed addition will also test your oh-so-sensitive concern for increasing local housing.

        • Ok definitely agree with you on SDUs. We need more of those and we need to revamp the rules that make them less feasable. Currently they can’t be more than 500 sq ft. and you can’t build one if a neighbor has one within 300
          ft.

          The idea that more housing will increase rents is what SF progressives have believed for decades, and look where that’s gotten them. Burbank does not build enough housing and we do have a responsibility to build our fair share of housing units to accomodate regional population growth. Look at this research I’ve done from a long article I’m writing about this issue in Burbank. https://twitter.com/boxbro39/status/775910899144073217

          Also watch this. It’s what I’m all about. http://www.pbs.org/newshour/bb/the-san-francisco-activists-who-say-please-build-in-my-backyard/

          • semichorus

            SF has good rent control rules. They work well. There’s no more room to build anyway.

            If developers flooded Burbank with tons of new and cheap units, the prevailing rents might go down. But that’s a dream world. More expensive apartments float ALL the asking rents up. “Supply and demand” is a myth.

            Sure, a sudden influx of a huge number of new apts might make rents go down. But only for a short time. Populations then attracted to the area would see them quickly rise.

            And who wants more apartments here? Burbank already has plenty.

            • you can always build up. there’s no such thing as a city that has run out of room. Plus there’s tons of underutilized sites. The thing is, we need to continuously build new apartments at a steady rate to keep rents from rising. That hasn’t happened for decades. New apartments are more expensive, partly because they’re newer and nicer, but partly because of our overly restrictive regulations requiring tons of parking (1 underground parking space adds about $30,000 to a projects budget) and limiting density.

              As for rent control which you keep mentioning, I’m not against it. It can be good and help people stay in their apartment. The thing is though, it does nothing to help people newcomers to an area that isn’t building enough housing, since asking rents go back up in rent control buildings when existing tenants leave. Building more units (ideally displacing nobody) will always be a better solution than rent control to help overall affordability. One idea I do have for rent control is in LA. Every building built 1978 or before is rent control. That should be extended to every building once it turns 30.

              • semichorus

                Unfortunately, Costa-Hawkins — which mandates the vacancy decontrol you mention — also prohibits any city from extending rent control past 1995 buildings, and even to extending the dates for their current rule if it ends well before 1996.

                Which means that LA’s limit of 1977 can never be changed. Burbank on the other hand must limit its rules to 1995 and earlier buildings.

                I don’t see how units built up on expensive land can ever be cheap or affordable.

                • I guess that last part can be kind of a hard concept to wrap one’s head around. Large projects often include a number of income restricted affordable units through the AB 1818 density bonus law. I assume you’re familiar with that. Consider that new apartment buildings built decades ago had rents higher than what was normal for the area. As they’ve aged though, the rents in these buildings aren’t necessarily cheap, but they’re about what is average for the area.

                  • semichorus

                    Not in Burbank. Those big complexes they built 20-30 years ago are still super-expensive. Hardly normal.

                    Few local developers take advantage of the density bonus — which is basically a bonus to them.

  3. I just briefly browsed zillow. Rents in complexes built in the 80s or so don’t seem any more expensive than rents in complexes from the 50s or 60s.

    Part of this article sums up well what I was trying to say. http://www.latimes.com/opinion/livable-city/la-ol-thom-mayne-climate-change-density-newhall-ranch-20161103-story.html

    “Moreover, advancing available housing stock at a broad scale along Wilshire Boulevard reduces demand pressure on the entire L.A. housing market. Affordability depends on availability. Los Angeles is in a housing crisis not because of the proliferation of high-rise luxury apartments — which actually alleviate pressure on the rest of the housing stock and drive prices down at the macro scale — but because an artificial constraint on development limits the overall supply. Current hurdles to development and a high supply-demand gap make luxury housing the most logical option for developers today, but a building boom along the corridor would open up development opportunities for affordable housing, including micro-units and other inexpensive to mid-level housing.”

    • semichorus

      Zillow’s not authoritative on rent values. It’s meant for hyping and selling the buildings. It’s not even too good on current ownership– just like Blockshopper does now, they’ve been hiding certain info from the records.

      Those big complexes of the 80s (which most of them are, like the ones east of Olive on SF etc.) are HUGELY expensive compared to the nearby “dingbats” on the Hill.

      • I’m a big fan of dingbats. They aren’t always super nice looking (though many have cool space age designs I enjoy) but what I admire is how they were able to be mass produced and provide a lot of people with reasonable rents. The fact that they were cheaply produced though means they might have by kind of falling apart a little bit now. Considering this it makes sense that the rent of a 1 bedroom in a dingbat from 1960 would be cheaper than the rent of a similarly sized 1 bedroom in a 3 story complex built in 1985.

        Also consider if those complexes hadn’t replaced single family homes in poor condition in the 80s. The people renting in those complexes would have to compete with those renting in the dingbats for less units (only the dingbats would exist). It would drive the asking price for rent up and make it even harder for people with lower incomes to live here.

        Also just want to mention it’s refreshing to be able to have a constructive conversation with someone I agree with very little on, so thanks.

        • semichorus

          No problem. Not all lefties are bad.

          I agree with you about dingbats– I love ’em, and I understand they’re becoming quite rare. You also might be right about what the 80s apts did to the rental market in Burbank, but I think too many expensive additions to the pool will make all rents go up.

          I agree that a large addition of new apts to the market would depress it enough to lower the overall rents in town, a la supply and demand. But it would only be temporary (outsiders would flood here at the news), and it would have to be a LOT. Like thousands and thousands.

          I’m all for tons more SDUs though. Burbank used to be full of them, especially in its nicest neighborhoods. No one ever complained about them.

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