An ambitious housing bill sparks debate over the best way to build more and bring down prices.
“Everyone hates SB 50—everyone hates it,” said California state Sen. Scott Wiener at a recent forum on the state’s housing crisis. “You hear people getting upset about it, yelling about it, coming down to City Hall and yelling.” Flanked by real estate developers and housing rights advocates, Wiener, a Democrat who represents San Francisco, had come to discuss his ideas for solving the problem—which meant talking about his signature piece of legislation, Senate Bill 50—the housing bill Californians love to hate.
Everyone agrees that California is facing a housing crisis. Rents and home prices are soaring: The median home price in the San Francisco Bay Area is $830,000; in Los Angeles County it’s almost $600,000. Homelessness is increasing: Nearly a quarter of the nation’s homeless population lives in California. Low-income residents are being displaced by the wealthy: More than half of all home buyers in San Francisco last year work in the software industry. And there just isn’t enough housing to go around. Wiener likes to cite a report by McKinsey that found that California has 3.5 million fewer homes than it needs
“The fundamental problem is that we have a massive housing shortage, which explodes housing costs and which puts enormous pressure on tenants in particular because the rents go so high,” Wiener told me just before the forum. “We have to lessen that pressure by adding more housing of all varieties at all incomes.” SB 50 is his attempt to expand the housing market to allow for faster, bigger, and denser residential construction. It’s an idea that many people agree with in the abstract, but in trying to make a workable plan, Wiener has grabbed one of the third rails of California politics.SB 50’s opponents have called it “an act of war on homeowners” and “a Trojan horse for big developers’ profits.”
SB 50’s opponents have called it “an act of war on homeowners” and “a Trojan horse for big developers’ profits.” One housing rights group said it would cause “Negro removal.” While complaining about the bill, the vice mayor of Beverly Hills likenedpro-housing “Sacramento politicians” to the Old Testament villain Haman. Politicians from SF to LA worry the bill would undermine local housing plans; suburban NIMBYs don’t want apartment buildings in their neighborhoods; and housing rights activists lambast the bill’s “trickle-down” approach, which they say will only further fuel gentrification.
At SB 50’s core is “upzoning,” overriding local zoning laws that prohibit higher-density housing construction in residential areas. Currently, zoning requirements in 80 percent of California forbid building anything other than single-family residences (with some allowances for in-law units). SB 50 would open up some of those areas—particularly those near major transit hubs, job clusters, and good schools—to higher-density residential construction. Developers would be allowed to build taller buildings with more units, with a requirement that a certain number must be rented below market rate.
The bill’s critics say it would not make a real dent in housing prices. “What the Wiener bill really is about is raising housing opportunities for highly skilled, relatively high-income people,” said Michael Storper, a professor of urban planning at the University of California-Los Angeles. SB 50 is built on the assumption that the market will react to upzoning by building more housing. That’s true, said Storper, but he warns that “the market will respond in the areas where the price of the construction is met by an effective market demand—a return on its investment.” And that means housing for the well-off.