California is in a housing crisis, and Yuba-Sutter is facing some of the same challenges.
There’s more demand than supply and officials said that’s affecting construction, growth, renters and affordable housing.The problem is, they don’t have an answer.
Arnoldo Rodriguez, Yuba City’s Development Services director, said the city is processing between 40 and 50 new single-family home permits each year. That’s better than 2012, when it processed only 14, but in 2006, for a year or two, the city processed about 800 permits, he said.
“Would we like to see additional residential growth? Absolutely,” Rodriguez said. “In Yuba City, the residential market, it’s market-driven.”
The city is experiencing a fair amount of commercial activity but has slowed in residential growth. Rodriguez said the city is helping with the initial legwork to encourage development through the Bogue-Stewart and El Margarita master plans, which provide long-range visions for the development of mixed-use communities.
But Holly Shackleford with Interwest Homes of Yuba City said high fees are keeping developers from building those homes that are in demand, especially in Sutter County.
“For us as builders, we’re going to have to look outside the area,” Shackleford said. “We haven’t been able to build a home under $350,000 in three years.”
She said builders face expensive impact and permit fees, which translate to higher costs for selling a home. That just pushes the rental demand, as people can’t qualify or afford to buy homes. And people aren’t moving out of their rentals, and owners aren’t selling rentals, she said.
A new home sale, about half the time, sparks another sale in the market with resales (someone selling their home to move into another).
“But without us building, those resales have nowhere to go,” Shackleford said. “You’ve got a chain of events. The need is there but right here for us, our fees have been an ongoing issue going on five years now.”
Dave Heer, president of the Sutter-Yuba Association of Realtors and a broker at Coldwell Banker, said locally there’s a huge shortage of inventory. He also called impact and permit fee costs “outrageous.”
“There’s a huge demand for housing and we can’t build enough, fast enough,” Heer said. “It’s always worrisome and that’s partly been the reason for the rise in prices recently.”
That means more expensive housing costs and multiple buyers on a single property, which creates problems for first-time home buyers. Currently, the Federal Housing Administration loan limit is $299,000 for Sutter County, Heer said, which means a larger out-of-pocket down payment. But if first-time buyers had that kind of money in the first place, they would not have needed an FHA loan.
“We’re becoming a nation of renters rather than homeowners, and that’s been a struggle for the California Association of Realtors,” Heer said.
In a May statement regarding a proposal to repeal the Costa-Hawkins Rental Housing Act, the California Association of Realtors said the solution is expanding housing stock, not introducing price ceilings.
“At a time when California is struggling to build enough homes to satisfy the demands of an expanding economy and its 39 million residents, now is not the time to enact rent control,”CAR President Steve White said in the statement. “What’s more, mandating artificial prices for rental units won’t fix the state’s housing supply and affordability crisis. It only reduces the supply of rental properties and creates an economic hardship for low-income and disadvantaged families.”
Yuba County, however, is experiencing better residential growth than its counterpart across the river: There are around a dozen developers doing production housing in the Edgewater, Plumas Lake and north Arboga areas, Code Enforcement Director Jeremy Strang said.
As of May, 154 dwelling permits have been issued in Yuba County – 50 of them are for homes in the foothills impacted by last year’s Cascade Fire. Yuba County has seen an uptick in permits issued over the past few years – 204 permits in 2015; 217 permits in 2016; and 259 permits in 2017.
Beckie Flores, planning and community development manager for the Regional Housing Authority, said rents have outpaced wages, especially in Yuba-Sutter.
“We have population growth and the pace of housing construction is not keeping up,” Flores said Thursday. “For all of our properties we have waiting lists, and they’re getting longer.”
Chief among a number of RHA’s projects are affordable housing, migrant housing and senior housing. While housing is a crisis as a whole, Flores said residents especially need affordable housing.
“It seems like in the 20 years I’ve been doing this, it’s gotten worse,” she said.
And for people on fixed incomes: “That’s just way out of their price range,” she said. “There’s no way they could afford current market rates.”
Like Shackleford, Flores said lack of supply is driving rents, and the slowing of housing construction can be attributed to operating costs.
Flores said she’s heard a number of potential fixes being proposed all over the state, like restricting Airbnb rentals in Santa Cruz, and rent control in larger cities. Californians will see several housing initiatives on the ballot in November, she said.
“For us, we’re focusing on maintaining existing stock we have, making sure it’s in very good shape and also building new,” Flores said. “And that’s really where our energy is focused.”