Even before the COVID-19 pandemic, unaffordable housing costs represented one of California’s most pressing challenges – and the job losses triggered by stay-home orders necessary to address the public health emergency threaten to exacerbate this long-standing crisis. Housing affordability is a problem throughout the state when housing costs are compared to incomes, and the Californians who are most affected by the affordability crisis are renters, households with the lowest incomes, people of color, and immigrants. Many of these same Californians are also especially hard hit by the economic effects of the COVID-19 public health crisis.
Housing costs are the largest share of most household budgets and access to stable housing is a key driver of economic stability. Yet millions of Californians — in every region of the state — struggle to pay their rents or mortgages each month. The state’s high cost of housing, lack of affordable housing, and stagnant wages block Californians from achieving economic security, including having a stable home. These challenges are especially acute for Black, Latinx, and undocumented Californians. The Budget Center analyzes housing affordability and highlights policy solutions to expand housing and economic opportunities for Californians as well as individuals experiencing homelessness.
Millions of Californians who are out of work are at risk of losing a key support that has helped cover the rent — enhanced unemployment insurance benefits. Research Associate, Aureo Mesquita, and Senior Policy Analyst, Sara Kimberlin discuss key findings from their new report Staying Home During California’s Affordability Crisis and explain how the COVID-19 recession is exacerbating the housing affordability crisis across California.
Housing costs vary substantially throughout California, with the highest costs in coastal urban areas and the lowest costs in inland rural areas. But incomes also vary regionally, and areas with relatively lower housing costs also tend to have lower typical incomes. The result is that housing affordability is clearly a problem throughout the state when housing costs are compared to incomes.
Supplemental Security Income/State Supplementary Payment (SSI/SSP) grants are a critical source of income for well over 1 million California seniors and people with disabilities who have low incomes and need help paying for basic necessities, such as housing. Grants are funded with both federal (SSI) and state (SSP) dollars. The maximum monthly grant for an individual is about $944, which consists of an SSI grant of $783 and an SSP grant of $160.72. To help close budget shortfalls during the Great Recession, the state made deep cuts to the SSP portion, reducing it from $233 per month in early 2009 to $156.40 per month by mid-2011. State policymakers increased the SSP grant by $4.32 per month starting in January 2017. However, no additional state grant increases have been provided since then, and the Governor’s proposed 2020-21 state budget assumes the SSP portion will remain frozen for another year.
Accessory dwelling units – commonly known as ADUs – are among the housing options receiving attention in the Capitol as state leaders look at a variety of policies to help Californians who are struggling to afford rent. While leaders are navigating how to handle the development and compliance of ADUs, it’s also important to look at the how such housing could improve health and social well-being for Californians.