Housing Is Key to Bay Area's Economic Future, Study Finds

Housing Is Key to Bay Area's Economic Future, Study Finds

Rising rents and stagnant incomes are straining household budgets and stifling opportunity in the nine-county Bay Area, jeopardizing the region's diversity, growth, and future prosperity, a report developed by the Bay Area Equity Atlas finds.

Developed through a partnership between PolicyLink, The San Francisco Foundation, and the Program for Environmental and Regional Equity at the University of Southern California, the report, Solving the Housing Crisis Is Key to Inclusive Prosperity in the Bay Area, found that housing in the Bay Area is the regional economy's Achilles' heel. Although the effects of the housing crisis are far-reaching, they affect low-income communities of color first and hardest, exacerbating longstanding racial inequities in the region.

The study, which examined data disaggregated by race, income, and geography, including new market rent data for neighborhoods provided by Zillow, found that more than 480,000 economically insecure households pay on average $9,000 more than they can afford on rent annually, adding up to $4.4 billion that they could spend on their family's needs or for other goods and services. The study also found that 60 percent of economically insecure residents are renters and that 75 percent of those pay more than 30 percent of their income for housing. Between 2000 and 2016, the average rent in the Bay Area increased 24 percent — more than twice as much as renter incomes (9 percent).

"This report tells the story that low-wage workers in the East Bay know too well — that the skyrocketing cost of housing is pushing families and people of color to the margins of our region and making it impossible for us to live stable and dignified lives," said Kate O'Hara, executive director of the East Bay Alliance for a Sustainable Economy (EBASE). "Policy makers should take note that advancing tenant protections and promoting community power are essential to laying the foundation for a just economy."

"On one hand, the data confirm what we already knew about the housing crisis in the Bay Area: that the situation is particularly dire for people at the lower end of the economic spectrum," said Fred Blackwell, CEO of the San Francisco Foundation. "Once forced out of their homes, there are precious few places in the region they can still afford to live. On the other hand, this report illuminates the specific actions that can be taken to counter displacement."

"Bay Area Report Highlights Housing as Key to Region's Economic Future." San Francisco Foundation Press Release 04/10/2018.