Terner Center Blog: No Limits

Rowing in the Same Direction? Aligning Sustainability and Housing Policies, Strategies and Goals

Posted on by Sara Draper Zivetz

Access to quality housing in stable neighborhoods is increasingly recognized as a fundamental building block for individual and family outcomes. Where you live, how much you spend on your housing, and how stable a place it is for you and your family has well-documented effects on economic prosperity, educational attainment, and health and well being, among others.

Meanwhile, the location, design and affordability of housing is also deeply tied to issues of environmental justice and climate change. As related but distinct segments of the environmental field, housing and housing policy play an important though often under-discussed role in both issues: on the one hand, the type and location of your housing can be intimately tied to pollution exposure, air quality, water quality and other environmental justice issues. At the same time, those same variables can affect whether and how many miles you need to drive to work, and your household’s contribution to CO2 emissions.

Recognizing the link between land use and housing patterns and environmental issues (both environmental justice and climate change goals) has been an important step forward for both sectors in recent years. As we pursue private sector practices and policies that factor in the goals of both sectors, however, we have come to confront a tricky reality: aligning the programs, policies, and funding that support climate change goals - such as greenhouse gas reductions - with those that support housing goals - such as housing affordability - is easier said than done.

Take California as an example. With some of the most ambitious emissions reduction targets in the nation, California is also straining under tremendous population growth and housing affordability pressures. The solution to the latter issue is complex, but must involve the production of more housing, more affordably. Increasing the supply is traditionally done through greenfield development and suburban sprawl, where land is readily available and the cost of production is relatively cheap. However, while building more housing in the suburbs may address supply constraints and help bring down the overall cost of housing, it brings up the overall miles families need to drive to access jobs and other amenities available in urban centers.

Legislation such as California’s Sustainable Communities and Climate Protection Act of 2008 (SB 375) have begun to get at this issue by encouraging land use planning that is more in line with climate change goals. According to our forthcoming analysis on the subject, however, this law doesn’t yet have the necessary combination of incentives and penalties to ensure sufficient or sufficiently well-sited housing production that meaningfully addresses either affordability or climate change challenges.

Other types of goals and priorities could also challenge the alignment of housing and environmental policies. For example, with the support of the 2015 Department of Housing and Urban Development’s Affirmatively Furthering Fair Housing Final Rule, many communities and stakeholders are working to ensure that funding streams, policies and approvals processes site affordable housing development in places connected to quality schools, jobs,and other resources, so that residents may access the same opportunity as higher-income neighbors and support their movement out of poverty. While in some cases, these are also walkable urban communities connected to transit, in many cases they are not.

These examples represent just two of the several points of potential incongruity between housing and environmental goals. But these frictions are not without potential for resolution; there are ways to create housing that is affordable, connected to opportunity, and contributing to greater sustainability and environmental justice. The Terner Center is committed to identifying and promoting the policy ideas and private sector practices that best achieve those mutually beneficial outcomes.

For example, we recently released a co-authored study with the UC Berkeley Center for Law, Energy and the Environment, supported by Next 10, that explores a housing production scenario in which California would address its supply shortage by building new housing in urban “infill” locations accessible to jobs and transit (rather than in suburban or rural areas). What did we find? This “target” scenario can be achieved at no added expense to residents (in fact, lowered cost of transportation would save both renters and homeowners a nominal amount each month), would reduce greenhouse gas emissions by 1.79 million metric tons, and would have the added benefit of generating over $800 million in additional economic activity compared to business-as-usual development patterns. The report concludes that with the right policies (many of which are proposed within), density is both a plausible and effective tool to meet both climate change and housing goals.

Meanwhile, a key conclusion of our SB 375 analysis articulates something similar: with strengthened incentives and enforcement mechanisms, this hallmark legislation could be instrumental in producing the right kind of housing, at the right price for residents, while helping to achieve climate change goals.

On a national scale, aligning these intimately related, but somewhat siloed issue areas is going to take a few key things: policymakers continuing to recognize their interdependence and promote the kinds of win-win policies that thoughtfully address both issues; both housing and environmental advocates developing closer ties and deeper understanding of each other's priorities and challenges to support this type of policy development; private sector actors such as designers and developers taking the helm to lead on housing and planning for greater sustainability and resilience and; institutions like the Terner Center offering the kind of analyses needed to better understand these potential areas for private sector innovation, these current and prospective tensions and misalignment in policymaking, and most importantly: the creative, pathways forward to better align and promote housing and environmental sustainability.

As we dive in earnest into this area of our work, we look forward to learning from those already working at the nexus of theses issues, and sharing our future findings, analyses, and big ideas to help propel both housing and sustainability goals forward.

Balancing the tax code to relieve housing cost burdens

Posted on by Terner Center Team

Of the more than 21 millions renters in the United States who are burdened by the cost of housing today, more than 15 million can not access assistance they are eligible for, because there aren’t enough federal resources to meet their needs. In part, this is a result of skewed tax code that directs significant expenditures to homeowners and other policy priorities, and leaves the housing security and economic mobility of renter families behind.  Amidst emerging conversations about reforming the federal tax code, it is important that we are reminded of this imbalance and seize the opportunity, should there be…

Building Affordability by Building Affordably: the case for Off-site Multifamily Construction

Posted on by Carol Galante and Sara Draper-Zivetz

To remain relevant and successful over time, every industry must modernize and adapt to changing demands and opportunities in the marketplace. The housing development industry is no exception, and over the years, has experienced its fair share of evolutions and revolutions in business model and product design. Today, as housing developers face rapidly changing consumer preferences, population demands, technological advances, and an ever- rising cost of construction, the adage “innovate or perish” may be timelier than ever. How will the housing industry adapt to these new realities? As a recently released report from McKinsey & Company points out, the construction…

Federal Policy Outlook: 2017 and Beyond

Posted on by Terner Center Team
Filed under: Informing the Dialogue,

Since November's federal election, many have been considering what the incoming Administration portends for housing policy and practice in the next four years. Last Tuesday, California Housing Consortium and the Terner Center for Housing Innovation welcomed over 100 people to a panel discussion in Oakland intended to explore this question. The event brought together housing experts Michael Novogradac of Novogradac & Associates, Chris Gouig of Alameda County Housing Authority, Matt Schwartz of California Housing Partnership Corporation, and our Faculty Director, Carol Galante. CHC Policy Director Marina Wiant moderated the conversation, asking questions about tranistions in federal leadership in housing, the nature and implications of impending tax reform,…

Opening Doors to Homeownership Series Part 1: Lease-Purchase

Posted on by Carol Galante, Carolina Reid, Rocio Sanchez-Moyano

A number of recent studies suggest that the American Dream, with its promise of upward mobility, is diminishing for current and future generations as the racial wealth gap grows and access to opportunity shrinks. This troubling trend is most evident in one of the dream’s most potent symbols: homeownership. In recent years, alongside widening inequality, rates of homeownership among young adults and minority families have declined precipitously and, in 2016, the national homeownership rate fell to its lowest level in more than 50 years.  What explains this trend? Working families (and especially lower-income and minority households) seeking to buy their…

Balancing the Burden: Proposing a FAIR Tax Credit for Renters Facing Affordability Challenges

Posted on by Carol Galante, Carolina Reid, and Nathaniel Decker

By most accounts, rents have never been higher. In the United States, over 21 million people see more than 30 percent of what they earn go to rent each month. And over 11 million Americans are paying more than 50 percent of their income to rent their home, leaving little left over for other essentials like healthcare and food, and leaving too many facing a precarious stretch of days until their next paycheck. And this is not just a problem of poverty: because rents have risen faster than incomes, even renters who are working full-time and earning modest wages are…

Housing Highlights from the 2015 American Community Survey

Posted on by Jed Kolko
Filed under: Demographic Trends,

The Census Bureau has just released the 2015 American Community Survey (ACS), the most detailed and comprehensive regular source of housing data for the U.S. and local areas. The housing market continues to ease back toward normal, with a drop in vacancies, an increase in single-family owner-occupied units, and a decline in cost burdens. However, homeownership fell yet again, household formation remains below normal, and more young adults are living with parents (2016 Current Population Survey data). Here are the housing highlights from the 2015 ACS, with more detail available in this slide deck: Homeownership and household formation (slides 3-10): The…

A Golden Rule for the Golden State? How State Action Could Help Solve California’s Housing Crisis

Posted on by Carol Galante, Carolina Reid

In the United States today, over 20 million households are spending more than 30 percent of what they earn just to pay the rent or mortgage on their home. Both locally and nationally, the repercussions of this affordability crisis are taking center stage. In recent weeks, the resignation of one local leader over housing costs and frustration with chronic political inaction in her community set off a flurry of media coverage and social media conversation. Meanwhile, recent poll results have elevated the issue of housing affordability onto the national stage as well. Underlying these recent events is the reality that the…

Small Houses, Big Impact: Accessory Dwelling Units in Underutilized Neighborhoods

Posted on by Rocio Sanchez-Moyano and Carol Galante

As NIMBY’s (Not in My Backyard) continue to oppose new housing development, a new group of homeowners are saying yes, by literally building new homes in their own backyards.  Accessory dwelling units (ADUs), also referred to as in-law suites or granny flats, are smaller, independent units on the same lot as a single family home (sometimes even an extension or a reworking of the home itself). ADUs were common in the early twentieth century, but went out of favor post-World War II as single-family, suburban style development characterized by large lots and an emphasis on the nuclear family became the…

State Policy Solutions to the Short Supply of Housing

When it comes to a lack of affordability in housing, it’s no secret that California is outpacing the nation. Average home prices are about two and half times more expensive than the rest of the country, and rents are about 50 percent higher. A shortage in supply is a key contributing factor, and we need both public policy and private sector solutions that will help expand housing production to better meet demand. This week, the Terner Center is sharing an analysis of one important avenue to meeting this challenge in California: improvements to state land use regulations to promote an…