California Today: Tax Proposals Threaten Lower-Income Housing

This is just sad.

Affordable housing=take taxpayers money to subsidize non-taxpayers so the developers can get filthy rich and live as far away as possible from what they build.

California politicians didn't mind sticking it to the poor and lower middle class when they passed a 10% tax on gas recently. Commuting is California's real "affordable housing solution". Lower income people live in areas where houses are cheaper and commute to work, sometimes 100 miles a day or more. Democrats in our legislature stuck a fork in these folks by increasing their daily commute cost dramatically. Now they are screaming about how the Republican tax plan is going to make it harder to build the tiny amount of affordable housing located in high value real estate areas. It's a disease called hypocrisy, and most politicians of both parties have a bad case of it.

While we certainly don't need any additional challenges affecting our housing situation, the tax breaks alone won't solve the problem. I have been house hunting in SoCal for a year. Perfect credit, debt-free, but a single income household and a daughter to get through college. Even if you make $100K, that's just not enough to buy a decent house. So I started looking at fixer-uppers. A shoe box that's falling apart and has hoarders living in it will still be in the high $300 thousands. Made about a dozen offers and got beat out by cash investors every time. Why are there no rules to give preference to residential buyers over investors? Other states have such stipulations. As for me, I eventually gave up on buying a house.

The only winners in the affordable housing fiasco are property owners. This has nothing to do with anything other than greed. We just had a horrific month of wildfires here in california and thousands of people are homeless. Rents for homes have in some places climbed to 12,000 a month. Families are doubling up so they can stay in the areas where they also have jobs. The excuse for the high rent? "Oh the Insurance Companies are paying the bill." If we had a State and Federal Government that worked for the American people we would have some sort of rent and price control. This would enable people to settle in and become a part of the communities where they want to live instead of what we have now, a State where people spend almost 4.5 hours in car on average, (If you are lucky). You can't have it both ways. California has been operating this way for a long time. It's time for it to stop.

I'm not so sure. I look at the proposed doubling of the standard deduction as a move to encourage renting over ownership, with REIT's and other parked money going into building rentals, moving away from condos. That becomes an inflation hedge for 1% money parkers, inducing a lot of rental construction.

I find it interesting, and perhaps ironic, that Mr. Novogradac is a major donor to Republican politicians in California.

To be clear, California is mostly responsible for their affordable housing crisis - with all the NIMBY feelings going on, they keep most new building out of the most desirable places with endless planning board regulations, endless paperwork, endless reviews, years and years of fighting city hall. The few housing units built mean they cost more. That's pretty simple math.

Why such a convoluted scheme to provide housing for our fellow citizens left behind by globalization and gentrification? Many fewer steps if we simply contract for a building. And streamline some permitting.

Half of the affordable housing projects don’t get built without tax exempt bonds and tax credits. Without these subsidies, the developers build market rate projects. We need twice as many affordable housing units. Not half as many. If you don’t think housing for all people matters, I’m guessing you have housing and believe you always will. I hope you’re right, but I also hope you’ll read Evicted by Matthew Desmond. We’re all at risk. I’m willing to have a portion of my federal tax dollars allocated to subsidize affordable housing. Better that than bombs.

The Times loves the current tax code 1. Govt picks winners 2. Looks progressive on paper but can be easily gamed

Nonprofit housing developments in California typically take around 7 years to plan and complete, due to endless paperwork and planning exercises. The root problem is often developers' reluctance to build units that have much smaller returns on investment. This is a poor excuse. Any housing project here these days will make money, and designing strictly for maximum returns has resulted in new San Francisco apartments being rented for astronomical sums. Meanwhile, the City still owns undeveloped land, in spite of their claims of wanting to support low cost housing. It's a similar situation in Oakland and San Jose, and let's not even talk about Palo Alto. Tiny apartments with simple geometries and absence of things like $30k kitchens would help the Bay Area housing problem immediately. The format would be a public/private partnership via cheap land in exchange for design and cost protocols, with an emergency declaration. A good model would be what I did in Kobe, Japan, when housing was desperately needed after the earthquake. We built 300 units, 288' apiece, that were code compliant and occupied withing six months of the earthquake. Cost was less than $40 a square foot. Japanese public and private sector actors moved quickly and effectively. The difference was cultural: Japanese wanted to help people whose homes were destroyed, especially those from a wood framed neighborhood that burned down, killing thousands. Here, they just talk. I'll help: mike.greenframe@gmail

It doesn't make sense to me to subsidize housing for the lowest income individuals, when middle income individuals are struggling to afford rents in an area. By subsidizing the lowest income individuals, a society is creating an artificial situation where the people who can least afford to live in an area are helped the most, while those who are closest to being able to afford the rents are not helped at all. More, the greater effort of middle income folks towards meeting the costs of living in a given area, is not rewarded, while the lack of effort of the lowest income folks is rewarded most with the most aid. We need to completely rethink the way that we give aid to people, and begin to factor in the degree of effort that people are making to solve their own problems. Also, subsidies should not be given to developers who build, but should be given to individuals who rent. That way, the subsidy is not linked to the building itself and they are free to move.

Let the market tell you where you can afford to live. Subsidizing people does not help anyone get ahead.

Conor, ironic that some see a disadvantage to removing tax breaks “which fund affordable housing” in the most expensive housing market in the country. Maybe, removing those tax breaks - which don’t “fund affordable housing”, but the wealthy developers who build and rent them - might force landlords to reduce rates to maintain occupancy; might force banks to refinance properties to prevent loans from going into default; and might help to reduce current prices for residential real estate, which can best be described as obscene. Another problem to which the wealthy see a solution in making themselves wealthier.

The article poses a nice theory, but what I really read about was an attempt to give tax money to corporations. If California wants to give their money away, that's fine. Just don't plan on using other states money to support an economy people are literally leaving to escape.

"Beyond cheap rent, these developments offer things like flu shots, job training and discounted internet that keep people employable and help them move up in the work force." Not true. Many of these offer nothing more than cheap rent and increase housing costs for most people through various fees. It's the "Golden Ticket" theory of government services.