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Inclusionary Zoning Deadlock

Posted by novometro on October 18, 2006

This from Mayor Brown’s press office regarding Tuesday night’s City Council deadlock on inclusionary zoning: “The Mayor will make a careful study of the situation and talk with staff. He’ll weigh the options carefully before taking action.”

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Posted in Development, Oakland, Real Estate, Zoning | 2 Comments »

Inclusionary Zoning is Back

Posted by novometro on October 17, 2006

This is a tough one. Oakland City Council takes up an inclusionary zoning ordinance Tuesday evening that would require 15 percent of new rental units in the city be affordable to a family of four earning around $50,000. Affordable units for sale would have to be within the budget of a family of four with an annual income of $83,000. Thus, a maximum rent for a four-room apartment would be $1,458. A spacious, new condo could be had for $250,000. Developers could also opt to put money in an affordable housing trust fund. The fee for a project with 100 market-rate, two-bedroom units would be $5.3 million.

That works out to a “tax” of $53,000 on each unit. The question is this: Will that mandatory extra cost stifle development in Oakland? Oakland Native thinks so. And a paper published by the Reason Foundation in 2004, a Libertarian think tank in Los Angeles, argues that inclusionary zoning fails to create affordable housing while it simultaneously prohibits the creation of market rate housing. The study ends this way: “Inclusionary zoning should only be enacted if the goal is to make housing more expensive and decrease the quantity of new housing.”

But a 2002 study prepared for the Los Angeles Housing Department concluded that inclusionary zoning policies throughout the state have not hindered housing production, but have actually resulted in more housing in places like Sacramento and San Diego. The study found that “housing starts most closely track the unemployment rate.”

Part of the problem in evaluating the pros and cons of inclusionary zoning lies in the wildly different numbers the researchers use to support their competing arguments. For example, the authors of the Reason study claim that inclusionary zoning policies in the Bay Area have produced only 7,000 units over 30 years. According to another team of analysts in Washington D.C., that figure is off by about 93,000.

Crafted by City Councilwomen Jane Brunner and Jean Quan, the proposed ordinance would make an exemption for projects within 1,000 feet of a BART station.

Erecting a speed bump to development in Oakland makes me nervous. So does the prospect of Oakland no longer being an affordable home for the kinds of immigrants that make a city a hotbed of entrepreneurialism and creativity. Jane Brunner told the San Francisco Chronicle it would have been better to introduce inclusionary zoning in the midst of the housing boom. She’s right. It seems dangerous to do this now with DataQuick reporting Monday the first downward tick in housing prices in four years.

Posted in Development, Environment, Housing, News, NovoMetro, Oakland, Opinion, Real Estate, Zoning | 5 Comments »