Terner Center Blog: No Limits

Category Archives: Increasing the Supply of Housing

Mapping Oakland’s Vacant Parcels

Posted on by Hayley Raetz

As part of our commitment to the education and professional development of UC Berkeley students, the Terner Center highlights exceptional student work that connects to our mission and research agenda. The analyses and policy proposals put forth in these projects may not be reflective of the official position of the Terner Center.

This piece is the second in a series to be released this summer by recent graduates of the City and Regional Planning and Public Policy graduate programs at UC Berkeley. The full report is available here.

Vacant Parcels in Oakland

Despite Oakland's high demand for housing, vacant parcels remain abundant throughout the city.

In the midst of a housing crisis fueled, in part, by lagging housing supply, vacant parcels represent part of the problem, as well as one part of potential solutions.

The Terner Center was recently invited to speak on a panel at SPUR to present and discuss my research mapping thousands of privately-owned vacant parcels in Oakland. Despite the city’s economic recovery since the recession, these parcels, typically empty except for grass or a paved surface, stubbornly persist throughout the city. When left in disorder, vacant parcels can negatively affect Oakland’s community, lowering quality of life,(1)  health outcomes,(2)(3)(4) and home values.(5)(6) If developed, vacant land could serve as prime real estate for much-needed new housing. New developments would also increase Oakland’s property tax revenue, bolstering vital public services.

According to interviews with developers, brokers, and land use experts, parcels remain vacant for a number of reasons:

  • Physical characteristics such as location, shape, or environmental concerns may undermine a parcel’s desirability for potential buyers.

  • Owners may decide not to sell their parcel, instead choosing to wait for a higher price or to develop the parcel themselves. Land speculation is abetted by Proposition 13, which results in long-term landowners paying very low property taxes on their land.

  • Ownership itself may be complicated: the parcel may languish in a larger asset pool, or it may be owned by a number of individuals in a trust.

  • Newly instituted impact fees can deter future land transactions, as they cut into development funds that might otherwise go towards buying parcels. My analysis shows that the majority of vacant parcels are in Oakland’s Impact Fee Zone 1, the most expensive fee zone.

Vacant parcels are typically small, and are often located in residential neighborhoods.

An analysis of Alameda County Tax Assessor data reveals about 4,000 vacant, privately-owned parcels currently sitting unused across the city of Oakland. These parcels are typically small in size and located in residential neighborhood areas. City Council District 3 has the second highest number of parcels, normalized by the total number of parcels in the district. Close to five percent of both Community District 3 and 4’s privately-owned parcels are vacant.

Vacant Parcels in West Oakland

The use codes tracked by the Alameda County Tax Assessor’s Office illustrate that the vast majority of the vacant parcels are zoned for residential development, and 2,893 (or 71%) of the vacant lots are zoned for four units or fewer.

Unlocking vacant parcels should be a policy priority for Oakland.

In order to meet future demand, the city needs to permit 7,530 more units by 2023,(7) including 1,072 units affordable for households earning more than 120% of Area Median Income (AMI) and 2,804 units for households earning between 81% and 120% of AMI.(8) If an average of two units were built on each of the vacant parcels zoned for four units or less, Oakland would add close to 5,800 new residences. Oakland’s vacant parcels could accommodate a significant number of new housing units and increase tax revenue.

This past spring, Oakland City Councilmember Rebecca Kaplan proposed a special parcel tax on vacant properties. The proposed ordinance would tax parcels that are deemed vacant, a designation that includes both the vacant parcels described above as well as parcels with empty residential or nonresidential structures.(9) If approved by Oakland voters, the tax could act as a deterrent for speculation, and encourage owners of vacant parcels to sell or develop their land, ideally unlocking sites for housing. Whether or not the special parcel tax is approved, vacant parcels represent an untapped asset for the city, and Oakland should continue to investigate policy proposals that incentivize better use of empty land.

(1) Chappell, A. T., Monk-Turner, E. & Payne, B. “Broken Windows or Window Breakers: The Influence of Physical and Social Disorder on Quality of Life.” Justice Quarterly, 28:3 (2010): DOI:10.1080/07418825.2010.526129

(2) Chaix, B. (2009). “Geographic Life Environments and Coronary Heart Disease: A Literature Review, Theoretical Contributions, Methodological Updates, and a Research Agenda.” Annual Review of Public Health. 30:1, 81- 105.

(3) Hill, T., Ross, C., & Angel, R. (2005). “Neighborhood Disorder, Psychophysiological Distress, and Health.” Journal of Health and Social Behavior. 46: 2, 170 - 186. Retrieved from: https://doi- org.libproxy.berkeley.edu/10.1177/002214650504600204

(4) Latkin, C. A. and A. D. Curry. (2003). “Stressful neighborhoods and depression: A prospective study of the impact of neighborhood disorder.” Journal of Health and Social Behavior. 44: 34–44.

(5) Mikelbank, B. (2008). “Spatial Analysis of the Impact of Vacant, Abandoned, and Foreclosed Properties,” Federal Reserve Bank of Cleveland. 11. Retrieved from: https://www.clevelandfed.org/newsroom-and-events/publications/special-reports/sr-200811-spatial-analysis-of-impact-of-vacant-abandoned-foreclosed-properties.aspx

(6) Whitaker, S. and Fitzpatrick, T. (2012). "The impact of vacant, tax-delinquent, and foreclosed property on sales prices of neighboring homes." Federal Reserve Bank of Cleveland. Working Paper 1123. Retrieved from: https://www.clevelandfed.org/newsroom-and-events/publications/working-papers/2012-working-papers/wp-1123r2-the-impact-of-vacant-tax-delinquent-and-foreclosed-property-neighboring-homes.aspx

(7) 5th Cycle Annual Progress Report Permit Summary. Retrieved from: http://www.hcd.ca.gov/community-development/housing-element/index.shtml

(8) Projected Housing Needs. Regional Needs Allocation. (2018). Retrieved from: http://www.hcd.ca.gov/community-development/building-blocks/housing-needs/projected-housing-needs.shtml

(9) Kaplan Supplemental Report. (May 2018).

Measuring the Housing Permitting Process in San Francisco

Posted on by Brian Goggin

As part of our commitment to the education and professional development of UC Berkeley students, the Terner Center highlights exceptional student work that connects to our mission and research agenda. The analyses and policy proposals put forth in these projects may not be reflective of the official position of the Terner Center. This piece is the first in a series to be released this summer by recent graduates of the City and Regional Planning and Public Policy graduate programs at UC Berkeley. How long does it take to get a building permit in the Bay Area? Ask 10 developers, you will likely get…

Why We Need a New Conversation on Rent Control in California, Today.

Posted on by Carol Galante

Leaders seeking to address California’s housing crisis are facing an important challenge: how to take meaningful and significant policy action to “stop the bleeding” of rising costs, eviction and displacement without generating new challenges that will only prolong the state’s deep affordability challenges. Today’s debate over rent control, and particularly, the movement to repeal Costa-Hawkins Rental Housing Act (which places statewide limits on how jurisdictions implement rent control), has pushed this challenge to the fore. One side of the debate is working to qualify a measure on the November ballot that would fully repeal Costa-Hawkins, enabling localities to expand rent…

It All Adds Up: The Cost of Housing Development Fees in Seven California Cities

Posted on by Sarah Mawhorter and David Garcia

In the summer of 2017, the Terner Center embarked on a seemingly straightforward task: determine the amount and type of fees levied on new residential development in seven California cities. What was initially thought to be a clear assignment turned into an odyssey of combing through difficult-to-obtain fee schedules, cobbling together piecemeal information across city departments, and repeatedly interviewing various city planning officials. The onerous and lengthy process our research team faced tells the story of the development fee process in California. While fees act as an important tool to mitigate the effects of new construction, the development and administration…

Perspectives: Practitioners Weigh in on Rising Housing Construction Costs in San Francisco

Posted on by Carolina Reid and Hayley Raetz

It is no secret that producing new housing in California is an expensive endeavor. Our Cost of Building Housing Research Series recently launched with the goal of understanding why this is the case, breaking down the elements of the housing development process to identify key cost drivers and potential private and public sector solutions. Today we are releasing our first brief of the series, which examines rising housing construction costs in San Francisco from the perspective of non-profit and market-rate housing developers, architects, and other practitioners on the ground. The brief shares findings from a series of interviews and focus…

ADU Update: Early Lessons and Impacts of California’s State and Local Policy Changes

Posted on by David Garcia

A multi-pronged approach to alleviating the shortage of housing in California and other high-cost regions is urgently needed. As we have discussed in past research, Accessory Dwelling Units (ADUs) - built with a small footprint predominantly in under-utilized single family neighborhoods - can offer much needed naturally-affordable supply to the market. In the fall of 2016, the California State Legislature passed a set of bills intended to clear the way for the proliferation of ADUs  in California. Even before these changes were adopted, many leaders at the local level were pioneering policies to make it easier for residents to build…

Scaling Off-Site Production in the United States: Lessons Learned from Swedish Leader Lindbäcks

Posted on by Mark Trainer and Carol Galante

When it comes to innovation in housing, what does the U.S. have to learn from Sweden? More than you might think. Though they have different histories, economies and social contexts, Sweden and the United States share many housing market challenges – including significant barriers to new construction and high cost of production leading to rapidly appreciating housing prices, especially in urban centers. The Terner Center recently published a policy brief providing a detailed examination of the Swedish housing system, and a companion summary outlining key similarities and differences with the United States. And last month, the Terner Center for Housing…

From Small Steps to Giant Leaps: What Must Come Next for the California Housing Agenda?

On Friday, September 15th, the California Legislature approved a package of 17 bills aimed at putting a dent in the state’s housing crisis. While the votes came down to the wire, in the end, the need for solutions won the day, and in the coming weeks the Governor is expected to sign each piece of legislation, officially ushering in the most significant housing policy changes in recent memory. You can read our recap of these bills in an earlier blog post here. Drafting, amending, defending and eventually passing these bills was no small feat, and the legislature, the Governor and…

Modular Construction in the Bay Area: The Future is Now

This post originally appeared on the ULI San Francisco Blog on August 2, 2017. After years of abstract discussions and false starts, modular building may finally be gaining the momentum it needs to make an impact in the Bay Area. Why now? And why here? On Tuesday, July 18, the San Francisco District Council of the Urban Land Institute hosted “Modular Construction in the Bay Area: The Future is Now”, an event moderated by Terner Center for Housing Innovation Faculty Director Carol Galante. The panel discussion featured four leaders committed to bringing this innovative housing method to scale in the Bay Area: Developers Rick Holliday of Holliday…

Jumpstarting the Market for Accessory Dwelling Units

This post originally appeared on the Berkeley Blog on May 23, 2017. It shares insights from our recently released report Jumpstaring the Market for Accessory Dwelling Units: Lessons Learned from Portland, Seattle and Vancouver.   ADU permitting explodes: Permits as a share of all residential permits. How did Portland, Oregon go from permitting two accessory dwelling units (ADUs) per month in 2009 to almost two per day in 2016?  Now, more than one of every ten housing units built in Portland is an ADU. Compared to other housing types, ADUs, or separate small dwellings embedded within single family properties, are…