California is still reeling from the impact of the housing market crash — with double-digit unemployment and a $25.4 billion deficit — and newly-elected Governor Jerry Brown has proposed deep spending cuts in response.
To the remaining Latino residents of the Mission — those who have managed to avoid being displaced by dot-com offices or priced out of their homes by the incursion of high-rent property — this will almost certainly mean less funding for affordable housing at a time when the city is becoming less and less accessible to immigrants and working families.
While the rest of California experiences a boom in its Latino population, San Francisco’s is steadily shrinking in the face of reduced services and rising rent.
The average price of rent for a one-bedroom apartment in San Francisco jumped from $1,258 in 2010 to $1,757 in 2011, according to Rentjungle.com, a website that tracks apartment listings nationwide.
The California Department of Finance noted a nearly six percent increase in the number of Latinos statewide from 2000 to 2008 in a report released last year. Some counties have experienced far more dramatic increases — Imperial County is now 78 percent Latino — but that same report showed that in San Francisco no such increase was occurring.
According to the New York Times’ “Mapping America” project, the Mission is still roughly half Latino, but this is a slight reduction from previous years.
“I think the larger issue is the city not being affordable for working families,” said District Nine Supervisor David Campos. “It becomes more difficult to finance projects, particularly affordable housing projects. The funding hasn’t been there…you use public funding to make those projects.”
He added that some projects which could reinvigorate the Mission would be nearly impossible to pursue under the pending budget crunch.
“At different times we have explored the idea of making the Mission Theater all developed into affordable housing,” but without funding, he said, that development won’t occur.
Nick Pagoulatos, an organizer affiliated with Dolores Street Community Services and the Mission Anti-Displacement Coalition, pointed to projects like the park and housing development on the former Public Utility Commission parking lot at 17th and Shotwell that have been approved but are not moving forward for lack of funds.
“We have a piece of land that could be potentially and immediately developed, but because of the shortfall in affordable housing fees, we can’t move the project forward until we build up reserves,” he said. “There are other sites…there’s the site on 20th and Mission, the Hotel Sierra — it’s still sitting there.”
Kevin Kitchingham, Housing Director for the Bernal Heights Neighborhood Center, says the funding shortage for affordable housing started around 2007, when Citibank wrote off roughly $6 billion in debt.
And when the housing market sneezes, affordable housing gets pneumonia.
“The current way a lot of affordable housing is done is tied to production,” Kitchingham said. “If there’s no production happening, then there’s no fee coming into the city. If there are no fees coming in, there’s no money to close the financing gap on housing deals.”
The San Francisco Redevelopment Agency and the Mayor’s Office of Housing are responsible for the majority of city-level funding for affordable housing development.
MOH Director Doug Shoemaker said the effect the market downturn has had on affordable housing is undeniable.
“There are literally 10,000 plus units that are unable to move because they have been unable to receive private capital,” he said. “The chill in the financial markets, and underwriting of condominiums in particular, has really slowed development…for the last two years, we have not had positive cash flows. In fact, we’ve refunded.”
However, he was quick to add that the larger concern facing affordable housing was the state budget crisis.
“The really big issue is not the one that’s been bothering us for the last couple years, it’s the one in front of us which is really scary… there’s about $5.2 billion a year statewide and 20 percent, by law, is required to go through low- and mod[erate]-housing funds, and that’s really the core of the threat to affordable housing in general in this city. If that goes away at the state level, there’s no way for us to save it at the local level.”
Supervisor Campos thinks that would be disastrous for the Mission and the city.
“Unless you create affordable housing, a lot of people who have called San Francisco home will not be able to stay here,” he said. “I think if we want to keep working people, especially families in the city, we have to create affordable housing…and I don’t see the free market doing that on its own.”
Kitchingham said that the financial crunch has led to fiercer competition for affordable housing funds, one that leaves smaller developers with closer ties to the community at a disadvantage.
“The small guys have a really tough time staying a majority partner…they have to play a subservient role to larger developers,” he said. “Then you’ve got to rely on the big guys to get you through, so your entering a few deals where you’re losing money, and that doesn’t keep the lights on where you are.”
“There is a difference between neighborhood-based developers like ourselves and larger agencies,” Pagoulatos said. “They’re not driven by community, and they don’t have the direct connection with the community that smaller groups do.”
The writer says, “And when the housing market sneezes, affordable housing gets pneumonia.” And yet the average one-bedroom apartment is renting for $1,757 in 2011 as opposed to $1,258 in 2010, he says. It sounds to me like the housing market in S.F. is doing just fine. So why isn’t affordable housing?