Housing Affordability Crisis In The Bay Area

The Middle Class and Housing Affordability Crisis In The Bay Area

As the lease of my apartment is coming to an end it had me thinking of achieving my own American Dream of home ownership but as I do my research I find the dream is far from coming true. I am sure that the issue of housing prices and rent rates are what most of us Bay Area residents talk about and debate. It is an issue that needs to be addressed by the officials of the area, city mayors, affordable housing committees, social justice activists,lawmakers, and even employers. Skyrocketing prices, low inventory, and investors’ bidding wars are not only pushing the middle and lower classes out of San Francisco and the Bay Area out but will completely eliminate them. 
It seems

that every time I look at purchase prices or rent rates, they keep going higher and higher at a rate that sounds ludicrous. In his article “San Francisco’s ‘housing crisis’ is reaching epic proportions”, Wolf Richter of Wolf Street explains, “The median house price in San Francisco has jumped 103% since the first quarter 2012 to $1.35 million in July; the median condo price has jumped 74% to $1.125 million. These aren’t palaces; condos include 1-bedroom and smaller units!”. As some people might argue that the median income in the Bay Area is relatively higher than other parts of the country, it is still too low for a family to afford buying a median house. 
The increasing prices are accompanied by a low supply of inventory in the market that’s faced with extremely high demand.

This high demand can be due to what many people call “historical low interest rates” as more people are interesting in home ownership especially young people to take advantage of these low rates. A prosperous tech industry in the area that keeps attracting highly skilled workers who earn higher than average incomes increases demand. In her article “Housing affordability crisis drives Bay Area middle-class exodus”, Mary Ann Azevedo explains that the Bay Area created 114,000 new jobs in 2014 and only 8,000 housing units. Azevedo further explains this low inventory, “The City of San Francisco is still producing only 2,000 housing units per year — when it has needed more like 5,000 for the last 20 years and going forward.” These statistics provide a clear picture of the seriousness of the situation and explains one of the major reasons that are driving the prices up with no sight of slowing

down.
A thriving economy always attracts investors from all over the country and the world, that’s what has been happening for the past few years. These investors naturally have the financial means to buy multiple properties and get involved in “bidding wars” which evidently pushes prices and demand upward. The average American family in the Bay Area cannot compete with these investors and they keep losing out on properties.
Many agree that the diversity of the Bay Area is one of the beloved characteristics that defines it, including different income groups living together without extreme segregation.

This housing affordability crisis is stripping away it’s diversity at increasing rates and I feel that not enough is being done to restore it. Liz Pfeffer article “Is the Bay Area in a Housing Bubble or a Crisis?” describes the situation as, “San Francisco’s chronic problem is a lack of housing for middle and lower-income people. It’s not that they can’t afford it, it’s that it doesn’t exist”. Officials should collaborate on creating solutions to the root causes and offer alternatives that would release some of the pressure. I would suggest promoting micro-homes or smaller scaled homes, limiting foreign investors’s purchases of single-family homes, or expanding campuses of employers to areas that are not heavily populated. It is not too late to restore the balance but it will take collaboration and team work. I am urging these officials and activists to try and save the beloved culture of this area and help retain it as a place where social justice is recognized and

practiced.