New Housing Bills to Go Into Effect

California has been in the midst of a housing crisis for years. A growing population and rising housing costs have both contributed to this crisis, and it is becoming increasingly difficult for many families to find affordable apartments and home. In fact, when adjusted for cost of living, California has the highest poverty rate in the country – nearly a quarter of the state's residents live below the poverty line.

Help is on its way, however. Governor Jerry Brown is aware of this housing shortage and has been pushing housing reform for quite some time. Last week, a sweeping series of bills aimed at addressing the issue were signed into law. A total of 15 bills were signed, each of which is intended to address the housing shortage in a different way.

Richard Bloom, a Democratic Assembleyman from Santa Monica, assured his constituents, “Today we are here to tell those who are suffering that we hear you and are committed to make housing affordable again.”

The various bills affect developers and the real estate market in a variety of ways. Some of them set money aside as incentives for developing affordable housing units. Others penalize local city governments for failing to allow local development of low-cost housing to go forward.

A Closer Look

A number of these bills seem to be quite promising. Senate Bill 2, for example, generates funding for affordable housing developments by imposing a fee of up to $225 on real estate transactions. It is estimated this will generate $1.2 billion in revenue over the next five years.

Senate Bill 167 applies a different strategy to encourage affordable housing construction. Under this bill, cities that fail to follow court-ordered construction of low-cost housing will be charged $10,000 per housing unit.

Senate Bill 540 empowers local city governments to come together and develop their own housing zone needs. By determining ideal building locations and formulating a zoning plan, they can speed up the approval process, and thus the construction process, of new housing developments.

The aforementioned Richard Bloom wrote Assembly Bill 1505. This bill allows local governments to pass ordinances and regulations requiring developers to include affordable rental units in their construction plans.

These are just a handful of the bills that passed the California legislature last week. It will likely take several years for these bills to start having an impact, but good news is always welcome.



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