At this point, pretty much everybody who didn't buy >10 years ago, inherit a house from Mommy and Daddy, or win the IPO lottery or BMR lottery has affordability issues.

The way you improve affordability and availability for everybody, not just the lucky ones, is you increase supply and density. You build near transit, you build up, and you get a bit creative.

Hear, hear, Steve.

There are needs for both low-income and affordable housing. They are not the same, but both are problems in our community.

Is the main public policy tool available for "the middle" to help increase supply (through zoning and approval changes?)

No MP sesiident, you can't build and densify your way to affordability, it never worked even once in desirable areas, and never will. What you so is to encourage companies to move from an area that has too many jobs and economic activity, to areas that don't have enough and need them desperately. It's also called patriotism.

Mauricio, if that worked, companies would be moving out en masse. Unfortunately, that doesn't work for knowledge work, though it worka fine for manufacturing (which is mostly absent here)

So instead, how about a little less "I've got mine, so screw you" and a little more realization that the only way you get even a semblance of balance is to build more supply.

We already know that building more supply actually increases prices, diminishes our quality of life, doesn't make a dent in the demand for housing and irreversibly changes the identity of this town. I refuse to accept that companies will not move. Companies can't move in, hire employees without housing and demand that others house them. They need to be held responsible. Even within our region, there was no reason for Palantir to move into stratosperically expensive downtown Palo Alto instead of to the more affordable San Jose, Sunnyvale, Campbell areas. Now their employees demand to live in downtown Palo Alto. The only responsible thing is for them to create knowledge technology hubs around the state and country, were they are actually needed. It can be done and it must be done. If we stop kowtowing to those companies and their employees, they will move. Encouraging more businesses to move in and then whining about the job/housing imbalance is unacceptable. Space is finite, and sardine can living is appropriate for big cities, not leafy suberbs.

Those of us making between thirty and fifty thousand a year are jack out of luck when it comes to any sort of workforce or affordable housing. The only affordable housing that is ever built is for people who don't work or work at such low pay bottom of the barrel jobs that they are the only ones deemed "in need". No where can a single person making forty five thousand a year find an affordable or workforce housing option. We "make to much" yet the burden of paying full price rent, plus our tax dollars paying for those who don't actually contribute anything to the economy or pay taxes is on us. Affordable housing should not have income caps on it or if they do they need to be raised so that the majority of people who are rent strapped get help as well. I don't know about you but I'm tired of just making it, working my butt off 50 hours a week with no help for me, when people are part time burger flipping and get everything handed to them.

@mauricio - Palantir is a perfect example of why companies want to be located in downtown Palo Alto - why would 20 something, very highly paid people want to work in Sunnyvale or Campbell or San Jose for that matter. Palantir's offices are a stone's throw from Caltrain making it easy to commute from SF. There are lots of fun restaurants downtown. Downtown Palo Alto is a wonderful office park!

"And I live near and welcome more targeted housing projects in my neighborhood, which being in downtown, is an excellent place for housing for people with more limited mobility options."

Wrong. For one, downtown is a food desert except for people willing to spend the Whole Paycheck. The nearest decently-priced grocery store is Willows Market on Middlefield in Menlo, which requires moderate mobility. I also have no idea where to buy low to moderately priced clothing downtown. Do you? Lots of upscale upprice eateries, tho.

Agreed, we need subsidized housing for utility workers, responders, and teachers. (We get lots of propaganda along that line from housing developers, like 800 High, but they never deliver.) Why not buy up suitable houses around town, convert them to duplexes or triplexes, and rent them to eligible tenants? As a bonus, their kids get real yards to play in.

(I know, this doesn't involve building fields of massive concrete structures, but I propose we put pipe dreams aside and actually address the housing problem.)

Hi Steve, were you the Steve Levy who a while back on the KQED Forum show with the histrionic sighs? If so, I really think you communicated a lot more with the non-verbal comments than your verbal ones. It might behoove you to ask other people how it is you come off when you do stuff like that, or in your writing AND EDITING style as well. Sorry a bit of a criticism.

On the positive side, I think this is your first article where I agree with everything you say.

>> My hope is that we can build alliances between those who work 24/7 on behalf of
>> the lowest income residents and those of us who care about much broader housing
>> affordability challenges.

I wonder though what you think the alliances between these two groups would look like
and what they would accomplish. As your whole article makes the point the two are
almost completely different animals.

I, personally, feel like moving into the future of a world with many more bilions of people
with many more needs the land use paradigm is going to have to change. Also in need
of fundamental change is the relationship between people who are say, "world class"
as is the topic of the book "Average Is Over" by Tyler Cowen ... wonder if you've ever
heard of that?

Scientists have suggested that if we are to sustainably save the biosphere of our planet
human beings have to limit their use of the land surface. Being a "fanatic" I think that use
should be minimal, as we owe virtually everything we are and have invented or thought to
nature and our destruction of it is nothing short of suicidal/biocidal.

I know these ideas treat into areas traditionally provocative of knee-jerk reactions of
socialism, communism or whatever-ism one wants to dismiss ideas they do not like
with, but mathematical analyses of trends are pretty much all converging.

If there is limited land and people are to have civilized lives and places to live the three
levels you imply of land or space ownership should be more fully defined, but not only
that, as in any project management, and this would be a global dousy, they need to be
understandable and palatable to the marginal mass of people and should leave as
many rights to nature, space and life to every as possible.

So that would not only require an alliance between low-income, affordable income,
maybe no-income, but also some kind of managed expectations that "world-class"
billionaires cannot demand huge areas of the country to inflict permanent scars of
their presence on, and particularly in sight of everyone else.

JW:
-- I don't know about you but I'm tired of just making it, working my butt
-- off 50 hours a week with no help for me, when people are part time
-- burger flipping and get everything handed to them.

Well, I think you are onto something there ... a lot of people have miserable
lives and are tired and get no understanding or help. A lot more have relatives
and friends who live like that and the different in "class" divides them.

I think the majority of Americans would like this recognized and talked about,
and the Bernie Sanders Presidential campaign, and maybe to some extent the
Trump campaign are indicators of that. And Sanders' campaign when
statistically analyzed is said to be damped way down by the media and
establishment rules.

The problem is that our American Exceptionalistic hype says one thing, but the
reality of America says you are entitled to nothing but what you can beg,
borrow or steal. We have romantic wonderful documents about human rights,
the leaders of hundreds of years ago, (*) but as we learn every day some new
way in which the strong have marginalized the weak, and just like when you
put a few pennies away every day you grow your savings into a huge fortune
over time, when your power, freedom and rights are undermined a little every
day you lose a huge forture, and our media exists mostly to paper that over.

In my opinion, I like the Bernie Sanders approach,which by the way was
NOT a Marxist or socialist approach, but our own unique American approach
culminated in FDR's New Deal i.e.
1. People should have rights which need to be manifest in correctly
managed government policies that produce correct incentives.
2. The richest, strongest most powerful Americans have a responsibility
to the rest of the country.

The reality of this country, and in particular areas like the Bay Area is
Laissez-Faire capitalism with little social consciousness except by private
donor of philanthropy. The reason I believe in high taxes for the rich is
because depending on philanthropy takes away from the most positive
people forcing them to subsidize the antisocialness of the ones who do not
contribute ... which because of (*) over a long period of time becomes
libertarianism, feudalism, fascism and big problems.

Much easier, more equal and more sustainable to invest in people
like small businesses, a lot will fail but the ones that succeed more
than make up for them, and add depth and strength to the economy.

This is why these questions of housing are very important and deserve
more than idle talk and lip service so many news stories on these issues
deliver. And there is a lot of interest, more than we can handle from what
we see from the Sanders campaign. The bottom line is that people with
more money than they know productively what to do with besides sending
it offshore to Panama are taking from everyone else and strangling the
economy ... they just do not want to pay the taxes necessary to have
a great country ... because they just do not care, or believe. They don't
believe in global warming, or that cigarettes cause cancer, or that
sugar causes diabetes .... etc, etc, etc.

My question is, and has been for years, exactly how do you get developers to build "affordable" (non-BMR-type) housing? I have yet to see that happen in Palo Alto. And what are the potentially onerous "incentives" to get them to do so? Are any of them eagerly lining up to build dense micro-unit projects?

@Sheri

Developers are willing to build affordable housing without subsidies, but the city has to allow them to build them tall and dense. Tall and dense saves construction companies money. They don't have to acquire as much land. Smaller homes means paying less money for more housing units as less construction material and labor are needed per unit.

However, very little low income and middle income housing gets built due to NIMBY opposition to tall and dense.

As soon as there's such a proposal, the NIMBYs come out of the woodwork and complain about traffic congestion, school crowding, water usage, etc. There is also a hidden NIMBY agenda that ensures their own house prices remain high by limiting new housing supply.

City councils back the NIMBYs because making existing residents angry is the fastest way to lose a re-election. The builder must build fewer homes on the same amount of land, but still try to make some money. The builder inevitably chooses luxury housing then.

Look at what happened at Maybell. Denser housing was proposed. NIMBYs complained. Now, only a small number of new housing units will be built.

I don't think any city will encourage micro-units until the electorate is primarily renters, rather than homeowners. That's generally why you see denser housing approved for construction in big cities that have more renters.

You may find there more affordable housing than you think. There are thousands of poorly designed, maxed out units per sq. ft. ugly, 10 story cheap constructions boxes being built all over downtown Redwood City. These buildings in some cases over hang sidewalks or are built right up to them. Where are the setbacks? I digress, but the last time I tried to add on to my house there were larger setbacks than these behometh structures w/ no new greens pace. Good job developers, Shame on you city planners. These ugly tunnel effect, light blocking monstrosities will be there forever.
The good news is they overbuilt and this will result in lower rents as they chase each other to the bottom in rents to fill these housing project style buildings. So hang on police, fire, teachers, city workers, you will be able to afford to live downtown near shopping and mass transit soon. But you might want to wait because the rents for these shiny new structures are sure to go down as more come on line. Other than they destroyed what could have been a very fun attractive cityscape it's a win win for the developers and the tenants.

I have always felt that the real estate industry was a bit at fault here. the agents make a chunk of money each sale and they are always anxious to see prices go up and up. they get more for the higher priced unit. I know of offers at asking price when an agent held off and told the seller they should get more. It is endlessly getting more expensive that way. there needs to be a flat rate for selling a home rather than a percentage.

I am just lucky to have gotten here before this rat race began....around 1975.And I live in an affordable home paid off. But the neighbors are paying exorbitant taxes for similar land.
The other way to find affordable units is to encourage building "granny units" in the back yard for renters.

The thing that helped make housing affordable more than anything else in the last 10 years was the popping of the bubble in 2008/2009.

Save your pennies, wait for another crisis. Do not get caught in the mania of the moment.

"Developers are willing to build affordable housing without subsidies, but the city has to allow them to build them tall and dense."

I gather you have labored diligently to get tall and dense housing built in Atherton, right?

The true NIMBY wants to build in somebody else's back yard what they fear could otherwise be built in their own back yard.

High Rents keep out the riff raff...

I disagree with the premise of Levy's post. Why is it a crisis if Palo Alto doesn't have the distribution of housing options Levy thinks we need? As Curmudgeon implies, Atherton doesn't have a whole lot of housing diversity. And neither does East Palo Alto, though the options there are much different than in Atherton. Mountain View, Menlo Park and Redwood City, along with unincorporated areas all add different flavors to the housing mix.

If one takes the region as a whole, there's much more diversity in housing than in any one city. Even discounting the East Bay, we have a fair amount of housing diversity in the immediate area. It's true that the entire Bay Area is expensive compared to, say, the Central Valley. But that's not going to change much no matter how much politicians meddle in the housing market as long as the tech industry remains red hot and people want to live around here.

There's a lot of commentary on this thread about increasing density and building up, etc. This won't do much to solve the housing affordability issue, but it does have the potential of changing the character of Palo Alto to something other than it's been and something different from what current residents have demonstrated they want by buying here and choosing to remain here.

The conceit of Levy and others who think they have the knowledge and capability to design a better Palo Alto will, if listened to, make things worse for those of us who live here without doing much to help the putative targets of Levy's largess.

@Curmudgeon

Don't be such a curmudgeon. :-)

I'm just explaining that it's economically possible to fix the housing problem, but not politically. Some NIMBYs have gone so far as deny the laws of supply and demand, saying adding more housing won't alleviate the problem. On the other hand, they also say that if cities limited the demand side by reducing the number of local jobs businesses can add, housing prices would come down. According to them, supply doesn't affect prices, only demand does.

Of course, I don't think they really believe the laws of supply and demand are wrong. They are just looking for a way to prevent their own city's character from becoming more dense.

And there's the rub why housing prices will never come down lest we have an economic collapse. The NIMBYs are politically powerful. They want no growth or slow growth at all costs. If the local economy keeps growing faster than the growth in new housing units, you won't see a decline in prices.

excellent, Mary. People don't have the 'right' to live where they might want to live. I worry about the destruction of Downtown Palo Alto and city-wide - homes being leveled to construct apartments and the building of multilayered commercial buildings by those who don't even live here. Checkout the names of the builders. Not Palo Altans. Remember that few of the city employees live in Palo Alto but make the laws and policies for the rest of us.

Apple, certainly supply and demand works, but like most things within
a certain parameters.

For example, many people leave the Bay Area, and more apparently want
to from recent polls, because of the price of housing and quality of life.

The point is, is that there are a certain "reservoir" of people who are on
the margins of wanting to live here and not wanting to live here depending
on costs. If there is more housing built more of these people will move here
which will cause housing not to go down in price any more until that
reservoir is depleted or people change their minds. All of this is a moving
target dependent on multiple variables which means that supply and
demand may not apply like you think it would.

Long term, if, for example, we build tons are really cheap housing
and lots of people moved here, and then as over time the tech
industry does eventually diffuse out of here to other areas, then the
peninsula, and SF is left with huge numbers of vacancies that were
build for and meant for more or less mobile workers that perhaps
no one might want to live in to have a family?

We end up with rows of apartments like those in EPA and EMP
where people live in high density, no place to park their cars, high
crime and vandalism. One possible problem.

I did not mention Palo Alto in the blog nor did I get into solutions.

The point of the blog was to call attention to the plight of middle income families in the region and the state. I think high rents and prices have affected many in the middle including teachers, plumbers, public safety workers, nurses and many, many others who do not qualify for public assistance for housing yet are struggling.

and

to argue that the term affordable housing not be reserved just for low income households.

If I mention Palo Alto and when I suggest possible solutions comments are appropriate on these topics.

I am interested in readers comments on the two points I raised.

I will respond to some of the other comments shortly.

Thanks

Jay Ese:
>> I am just lucky to have gotten here before this rat race began....around 1975.

If you were here in the 70's you probably remember people saying more or less
the same thing back then. I remember walking downtown in the last century ;-)
and seeing for sale signs on some of the new condos and townhouses built
downtown and people remarking ... $300,000, for a condo ... ridiculous" and
even well before that as prices steadily rose. The cliche of the $1,000,000
"tearer-downer" was with us and true before the turn the century.

>> The other way to find affordable units is to encourage building "granny
>> units" in the back yard for renters.

Over the decades Palo Alto has gone from a place that had cars parked in
driveways and garages to now where almost no one parks their car in their
garage, and in fact most street parking is not over-subscribed. I know
certain blocks in Crescent Park you have to park a block away to get to
your destination to visit someone.

To allow more granny units without factoring in parking, or without some
opposing trend like

- super duper public transit
- smaller self-driving cars
- a competent city planners with grit enough to force parking capacity.
- new technology such as online shopping with local delivery.

I don't see where granny units are going to help much.

Also, who is going to spend the money it takes to live here to build and
rent granny units on their property, taking away from their own use of their
own houses merely to contribute to "affordable" housing for someone
else. If people do that they are going to want top dollar for those
rentals I would guess throwing some question as the to affordable
adjective.

Granny units may alleviate or add to the proverbial millennial in their
parents basement from having to move out and face usurious local
rents while looking for a career, but it for sure will not address any low
income housing concerns.

Maybe every city has to bite the bullet and designate some area where
super-dense highrise development may occur to house people who
mostly want to be here to work, establish a career, save for something
else and eventually leave around a main market and office space
area. The pull towards urban centers for jobs is undeniable so that
is where people are going to diffuse to against the gradient and that
causes the rise in housing costs. Maybe states need to subsidize both
affordable and low-cost housing to sustain what looks to be a very
long term trend. I'm sure developed and speculators would love to
exploit this to the max, squeezing out every last penny from people
who because of circumstances or regulatory and economic evolution
are just stuck. Subsidies make sense to me based on a kind of
right to housing because the alternative is simply wage-slavery and
that ought not be allowed, or if it exists it should be actively resisted
by government intervention.

> most street parking is not over-subscribed.

not = now ... most street parking is now over-subscribed

@Stephen

I agree with both your points. Housing supply has gotten so restricted that the middle class can't afford to buy a home here. We need to work on ways to increase housing options for people on all income scale levels.


@Plane Speaker

You've actually described how a typical supply, demand, and price curve works. As supply increases, price decreases, until it hits the level of demand consumers are willing to pay. It's possible that the price doesn't decrease that much because there is so much pent up demand. The region just has to keep adding supply to get the price going down. On the bright side, each new buyer is contributing a very high level of property taxes that subsidize earlier home buyers. The Bay Area's supply and demand dynamics work the same as everyone else's.

Whether he's talking about the region as a whole, or about Palo Alto alone, Levy is trying to solve a "problem" that really doesn't exist, and to the extent that it does, is self correcting.

First of all, as detailed above, there already is a wide variety of housing available in the general area from ridiculously priced mansions in Atherton to relatively low priced (by Bay Area standards) apartments in East PA and Redwood City. Going only a little further afield, there's even lower priced housing in San Jose and the East Bay. (The gardener we have lives in Hayward, and thinks its worth getting up early and commuting to the Peninsula for work because the money he makes compensates him for the extra time and hassle.)

There will be no shortage of plumbers and carpenters if "we" (I assume that by "we", Levy means the government.) don't "do something" about housing for them. Plumbers won't abandon this area: they'll simply charge enough to make up for the expense and hassle of commuting from further away or will charge so much that they can afford something acceptable to them even in this expensive area.

So what's Levy worried about? No one is forced to live in this area if their income doesn't support a standard of living that's acceptable to them. And no one has some moral right to live in Atherton, Palo Alto or in any other place.

None of this means we shouldn't be compassionate towards the poor. Anyone who's not capable of supporting him- or her- self should be subsidized to a minimum standard of living. That's fair, compassionate and moral. But does anyone really deserve to have their real estate choices subsidized when they say where they want to live is in the highest cost region in the country? I want to live in Hillsborough, but my finances won't support it. Should I get a subsidy?

I know plenty of smart hard-working people who really wanted to live in Palo Alto. But their income doesn't support it. So they buy houses in Redwood City or they rent in Sunnyvale. If their financial situations improve, maybe they'll live in Atherton someday. But why should we tax them so some other chosen few can have their Palo Alto dream subsidized?

I think Levy suffers from a common delusion: that he knows enough to design the perfect city or society or culture. This is a conceit that we can't afford. I don't think Palo Altans want the kind of city that solving Levy's "problems" would lead to.

Mary, I'll elect you to be the one to tell Palo Altans to "suck it up" next time their favorite store or restaurant closes due to rent or labor costs.

Stephen Levy said, "I did not mention Palo Alto in the blog nor did I get into solutions."

Umm, please reread your fourth paragraph...You clearly mention where you live in Palo Alto and you advocate certain solutions.

Then you conflate low-income with mobility-impaired. Illogical (or at least unexplained.)

You talk about labels ("low income" and "affordable"), but many of us think labels are a petty distraction.

But most of all I think you miss the matter that really irks many of us residents. That the politically-correct City Council is rushing to pack more disruptive high density housing into our neighborhoods with its high cost, lessening of quality of life, and counterproductive results. Take 801 Alma: City Council pushed to spend $10M of taxpayer money to build a hideous building. And what is our assurance that those units aren't being quietly sublet at market rates to high-income individuals?

You and others bring up the premise that teachers, firefighters, etc. cannot afford a house in our city. Does PA really have a problem attracting top-notch teachers to our school district? I don't think so; I think teachers are clambering to get a job in such a district where salaries are high and students/families are earnest in their value of education. So you are attempting to solve a problem that doesn't exist. And horrors that public servants might have to commute 10 miles from MV or Redwood City (very nice places) or even up and coming EPA!

Not everyone who wants to live in PA or Atherton or Pacific Heights SF can do so, and that's OK. Palo Alto does not owe an affordable home to everyone who wants one here. Call it NIMBY or selfish if you must, but our town and its residents cannot save the world.

I'd be fine with zero to no growth as @mary thinks is the real solution. In return, I ask that all of those homeowners pay property taxes that reflect the current value of their homes rather than based on prices from 10, 20, 30, 40 years ago. I for one, am tired of subsidizing wealthy entitled land owners in Atherton, Palo Alto and MP.

Low income housing needs:

What is the region's plan for appropriate retirement housing? People that have lived in PA, MP, other peninsula towns for decades as renters, and are now being affected by astronomical rent increases? Retirement savings doesn't increase after you retire, and these are not newcomers wanting to live in a trendy town.

These are senior residents with established friends, doctors, and more that literally cannot absorb 100% rent increases, and yet cannot, or should not move to far away locales to save money where they have no support network.

> Posted by plan for retirees??, a resident of Menlo Park: Sharon Heights
> People that have lived in PA, MP, other peninsula towns for decades as renters,
> and are now being affected by astronomical rent increases? Retirement savings
> doesn't increase after you retire, and these are not newcomers wanting to live
> in a trendy town.

I totally agree with that ... much more so than the people who say just because
you grew up somewhere doesn't give the right to live there forever. That's
certainly how it worked out for Native Americans, and most people whose
opinions I care about think that was not a trend we want to keep into the future.

The world is not something that should be purchased to be the status symbol
plaything of a few super-rich people. A really close look at Donald Trump over
the last year tells us a lot about the people who set up our system and manipulate
it over time to align with their personal whims and how much they have the rest
of the people and planet in mind as they play their games.

Robert, local stores and restaurants close because of property owners greed, and they keep closing whether we like it or not.

Portion deleted. Mauricio attributed to Robert something he did not say.

Mauricio if you want to post here comment on the two points in the blog

"I want to make two points.

One, housing for low income residents and affordable housing are overlapping but DIFFERENT categories

Two, there are negative consequences to using the term “affordable housing” when we mean housing for low income residents built as a result of public policies to support such housing."

I am talking about a region wide issue and one of language use. If you do not think housing is a large challenge for middle income households in the region (one poster argued that) say so.

@mauricio - so tired of your topical NIMBY response. Rents and property is more expensive in the Mid Penn than Manhattan. Why? Years and Years of poor planning by the municipalities of the bay area. For example, SF, SM and SC counties added 350,000 jobs in the last 5 years. Yet, in those same counties only permits for 50k units of housing we approved, housing 150,000 residents. So while it is easy to pass the buck to companies that should locate elsewhere, people who should not move here, or those who have been priced out, its it the lack of SUPPLY and the policies that created it that are to blame for this being the most out of reach area of the country for even upper middle class people.

PS - rising commercial rents are due also to Supply and Demand, not greedy property owners. Why should they subsidize your favorite restaurant, when you are unwilling to do the same for renters & buyers.