There is crisis in the city of Los Angeles due to a lack of affordable housing. This can be seen in the growing number of homeless people who sleep on the streets, and in the pressure on low- and middle-income families who need to spend more and more of their income on paying the rent.
A recent study by Harvard University’s Joint Center for Housing Studies reached the conclusion that lack of affordable housing is a problem for tenants nationwide. In Los Angeles, one of the cities most affected by this issue, it is estimated that last year 59% of tenants spent more than 30% of their income in paying the rent, and 33% of tenants in the Los Angeles and Orange counties spent more than half their salaries on the monthly rent.
It is estimated that in Los Angeles the median income of a family of four is approximately $55,909 per year, whereas the median price of a two-bedroom apartment is of $2,719 per month; that is $31,628 per year. This wreaks havoc in the family economy, since the rent absorbs the money that should be destined to other needs such as bills, food and clothing, among others.
This problem will only worsen in the next five years, when the city contract that keeps 15,000 affordable housing units expires. Owners are eager to replace current tenants with others who can to pay the high market rates. This will increase the deficit of 527,000 units required to fulfill the needs, as the County of Los Angeles Board of Supervisors estimated.
There are several proposals on the table, such as requiring developers affordable housing quotas, and to accelerate the permit process for constructors committed to offer 20% of low-income rent units in their buildings. There is also a push to allocate more county funds to this type of housing.
There is still no consensus on how to proceed. What is clear is that in the first half of 2015 Los Angeles authorized less than 20,000 residential units, when it is estimated that 55,000 new units are needed every year just to keep the prices under control. There is still a lot to do.