Housing and the California Dream – Orange County Register

Owning your home. It’s been the centerpiece of the California Dream and the surest source of generational wealth for families. Until 2008, it provided rock-solid housing security to 60% of Californians. Then the nation’s housing market collapsed, nearly bringing down the global financial system. The crash triggered foreclosures on the homes of more than a million California households.

Recent years have seen a slight recovery in home ownership rates, yet it remains well below the previous peak. With soaring prices, homeownership looks growing out of reach for young families. The median sales price for homes in Los Angeles and Orange counties jumped more than 28% in two and a half years. Wall Street investors gobbled up tens of thousands of homes in a new Gold Rush to cash in on rising rents.

All this profoundly affects local communities and the people who live in them. We’ve taken for granted homeowners that were the bedrock of stable communities. Families bought homes, raised kids and dominated civic life and local politics. Outside of a few communities like West Hollywood and Santa Monica, renters were essentially invisible.

That’s changing. As more cities shift from low-turnout off-year elections to the state and national cycle, renters are emerging as a powerful voting bloc. Recently city councils in Culver City, Santa Ana and Inglewood have responded by instituting rent control measures — and others imposed COVID emergency eviction moratoriums. Nithya Ramen, backed by a coalition of progressive, pro-renter organizations, racked up the most votes in the history of Los Angeles City Council elections to become only the second challenger to ous an incumbent in three decades.

Meanwhile, the mythic sanctity of the single-family neighborhood is under challenge. The racist roots of exclusionary zoning are being laid bare — and state government has intervened to spur more “missing middle” housing in those neighborhoods. First, rear homes (called “Accessory Dwelling Units”) were legalized and as of Jan. 1, most residents are allowed to either split their lots in two or build duplexes on their properties.

In theory, this could help homeownersship. Owners could offset high mortgages by renting units. Lot splits could increase opportunities for buyers. But construction financing of new units is a stretch for most households, so the impact will be modest at best.

Should California give up on housing security? The crisis of homelessness is just the most visible danger sign of leaving renters to the mercy of the market. There’s also the looming threat to our competition if workers are priced out. Just as disturbing is the erosion of community cohesion if families struggle to stay rooted.