👆 Percentage of metro area residents with cost-burdened housing, by income bracket

Source: Harvard Joint Center for Housing Studies

Local jurisdictions in California hold enormous sway over what gets built. Officials have often caved to NIMBY (“not in my backyard”) pressure against new development, much of it in the name of protecting the environment or preserving “neighborhood character.”

Parts of the state were downzoned starting in the 1970s, making it harder to build dense urban areas and contributing to racial segregation and sprawl. Three-quarters of the residential land in Los Angeles is restricted to single-family homes, according to UrbanFootprint, software that helps government and businesses understand cities and urban markets. In San Jose, the figure is 94%.

Housing Permits Per Capita California’s supply of new housing has not kept pace with its population Permits per 1,000 people 30 California ranked #7 in housing permits per capita in 1986... 25 ...but had fallen to #37 by 2018 20 15 10 ID UT CO SC NC FL TX WA DE 5 NV AZ SD GA TN OR MT MN ND NE VA IA ME AR LA HI VT NH KS WI IN KY MD WY NJ AL CA MO OK MA NM MS AK OH MI NY PA IL WV CT RI 0 1980 1990 2000 2010 2018 Permits per 1,000 people 30 California ranked #7 in housing permits per capita in 1986... 25 ...but had fallen to #37 by 2018 20 15 10 ID UT CO SC NC FL TX WA DE NV AZ 5 GA SD TN MT OR MN ND NE VA IA ME LA AR NH KS WI HI VT IN KY NJ MD WY AL CA MO OK MA NM AK MS OH MI NY PA IL WV CT RI 0 1980 1985 1990 1995 2000 2005 2010 2015 ’18 Permits per 1,000 people 30 California ranked #7 in housing permits per capita in 1986... 25 ...but had fallen to #37 by 2018 20 15 10 ID UT CO SC NC FL TX WA DE NV AZ 5 GA SD TN MT OR MN ND NE VA IA ME LA AR NH KS WI HI VT IN KY NJ MD WY AL CA MO OK MA NM AK MS OH MI NY PA IL WV CT RI 0 1980 1985 1990 1995 2000 2005 2010 2015 2018 Source: U.S. Census

California also has a distinct burden: Proposition 13, a measure approved by voters in 1978 that limits property-tax increases on homes until they’re sold. That’s been a boon for Baby Boomers who’ve lived in their houses for decades and aren’t assessed at anything close to their property’s market value. But it’s especially unfair to their children, who are in effect subsidizing their parents’ generation.

Prop 13 also created a fiscal incentive for many cities to favor new commercial development over residential construction—and heap fees on developers to fund budget gaps.

For decades, many Californians have just moved farther out of town to find cheaper places to live. But as climate change increases the intensity and frequency of wildfires—leading to devastation and billions of dollars in costs—officials may decide to put some areas off-limits for new construction.

That could exacerbate the housing shortage, said Stephen Levy, director of the Center for Continuing Study of the California Economy in Palo Alto. “At some point, the regions that are under pressure to build more housing are going to find areas that are prone to more frequent fires,” he said.

Not surprisingly, some residents aren’t waiting around to see what happens. In recent years, younger, less-educated and lower-income folks have led the exodus from the state, according to an analysis by the Legislative Analyst’s Office. They’re being replaced by high earners with graduate degrees in what amounts to a sort of state-wide gentrification.

Corporations are also decamping for lower-cost locales. Even companies like Apple, Facebook and Google that are still adding employees in the region have looked to cities including Atlanta, Austin and Pittsburgh for growth. The three tech giants have also pledged to address the issue itself, with a total of $4.5 billion in commitments toward affordable housing development in the state.

Those very same companies have been blamed for contributing to the crisis by bringing in a flood of workers over the past decade while housing supply failed to keep up. The Bay Area saw 5.4 new jobs for every unit of housing it built between 2011 and 2017.

Bay Area Housing Supply Failed to Keep Up With Its Job Growth Number of new jobs per new house, 2011 to 2017 More jobs than housing ⟶ 0 2 4 6 8 10 no data San Francisco SONOMA NAPA Santa Rosa SOLANO Fairfield Vallejo MARIN Richmond CONTRA COSTA San Francisco Oakland ALAMEDA SAN MATEO Palo Alto San Jose SANTA CLARA Home to Facebook, next door to Google, Apple. Boston STRAFFORD ROCKINGHAM Lawrence Lowell ESSEX MIDDLESEX Cambridge Boston Framingham SUFFOLK Quincy NORFOLK Brockton PLYMOUTH Seattle SNOHOMISH ISLAND Everett KITSAP Bellevue Seattle KING Kent Tacoma MASON Olympia PIERCE THURSTON Washington, D.C. FREDERICK Frederick JEFFERSON MONTGOMERY Rockville CLARKE Silver Spring LOUDOUN D.C. WARREN Arlington PRINCE GEORGE’S FAIRFAX FAUQUIER CHARLES STAFFORD CALVERT SPOTSYLVANIA All metro areas on the same scale: 40 mi 40 km More jobs than housing ⟶ 0 2 4 6 8 10 no data San Francisco SONOMA NAPA Santa Rosa SOLANO Fairfield Vallejo MARIN Concord Richmond CONTRA COSTA San Francisco Oakland SAN FRANCISCO ALAMEDA Fremont SAN MATEO Palo Alto San Jose SANTA CLARA Home to Facebook, next door to Google, Apple. Boston STRAFFORD ROCKINGHAM Lawrence Lowell ESSEX MIDDLESEX Cambridge Boston Framingham SUFFOLK Quincy NORFOLK Brockton PLYMOUTH Seattle ISLAND Everett SNOHOMISH KITSAP Bellevue Seattle KING Kent Tacoma MASON Olympia PIERCE THURSTON Washington, D.C. The number of jobs fell in these Maryland suburbs of Washington. Northern Virginia, which Amazon picked for HQ2, is booming. FREDERICK Frederick JEFFERSON MONTGOMERY CLARKE Rockville LOUDOUN Silver Spring WARREN Washington D.C. Arlington PRINCE GEORGE’S FAIRFAX Alexandria FAUQUIER PRINCE WILLIAM CHARLES CALVERT STAFFORD SPOTSYLVANIA All metro areas on the same scale: 40 mi 40 km More jobs than housing ⟶ 0 2 4 6 8 10 no data San Francisco Boston SONOMA STRAFFORD NAPA Santa Rosa SOLANO Fairfield ROCKINGHAM Vallejo MARIN Lawrence Concord Richmond Lowell ESSEX CONTRA COSTA MIDDLESEX San Francisco Oakland SAN FRANCISCO Cambridge ALAMEDA Boston Framingham SUFFOLK Fremont Quincy SAN MATEO NORFOLK Palo Alto Brockton San Jose SANTA CLARA PLYMOUTH Home to Facebook, next door to Google, Apple. Seattle Austin ISLAND WILLIAMSON Everett Georgetown SNOHOMISH Cedar Park Round Rock KITSAP TRAVIS Bellevue Seattle Austin KING HAYS BASTROP Kent Tacoma MASON San Marcos CALDWELL Olympia PIERCE THURSTON Washington, D.C. All metro areas on the same scale: The number of jobs fell in these Maryland suburbs of Washington. Northern Virginia, which Amazon picked for HQ2, is booming. FREDERICK 40 mi Frederick JEFFERSON 40 km MONTGOMERY CLARKE Rockville LOUDOUN Silver Spring WARREN Washington D.C. Arlington PRINCE GEORGE’S FAIRFAX Alexandria FAUQUIER PRINCE WILLIAM CHARLES CALVERT STAFFORD SPOTSYLVANIA More jobs than housing ⟶ 0 2 4 6 8 10 no data San Francisco Boston Seattle SONOMA STRAFFORD NAPA Santa Rosa ISLAND SOLANO Everett Fairfield ROCKINGHAM SNOHOMISH Vallejo KITSAP MARIN Lawrence Concord Richmond Bellevue Seattle Lowell ESSEX KING CONTRA COSTA MIDDLESEX San Francisco Oakland SAN FRANCISCO Cambridge ALAMEDA Boston Kent Tacoma Framingham SUFFOLK Fremont MASON Quincy SAN MATEO Olympia NORFOLK Palo Alto Brockton San Jose PIERCE THURSTON SANTA CLARA PLYMOUTH Home to Facebook, next door to Google, Apple. Austin Washington, D.C. FREDERICK The number of jobs fell in these Maryland suburbs of Washington. Northern Virginia, which Amazon picked for HQ2, is booming. Frederick All metro areas on the same scale: WILLIAMSON JEFFERSON Georgetown 40 mi MONTGOMERY CLARKE Cedar Park Round Rock Rockville 40 km LOUDOUN Silver Spring TRAVIS WARREN Washington D.C. Arlington Austin PRINCE GEORGE’S FAIRFAX Alexandria FAUQUIER PRINCE WILLIAM HAYS BASTROP San Marcos CHARLES CALVERT STAFFORD CALDWELL SPOTSYLVANIA Source: U.S. Census, Bloomberg reporting

What now? Newsom has vowed to be aggressive, and has taken steps such as suing a city for refusing to build affordable housing. At a ceremony last month to sign an anti-rent-gouging law, he was blunt about what else needed to be done: “We need to put in more damn housing.”

The coming year is likely to bring a showdown over one of the biggest issues: land use. An ambitious bill to force cities to accept density around transit and job centers was tabled in May because of opposition from suburban legislators, generating an outcry. Its backer, state Senator Scott Wiener, has vowed to try again in 2020. Whether or not he’s successful, the bill demonstrates the kind of sweeping change that researchers say is necessary to build more homes where they’re needed most, without sprawling into risky areas.

A Plan for Density in San Francisco A proposed bill would force local governments to allow more housing near transit and job centers Pacific Ocean Chinatown Tenderloin Outer Richmond Mission District Silver Terrace Excelsior Bayview Lakeshore Visitacion Valley 1 mi 1 km Pacific Ocean Chinatown Tenderloin Western Addition Outer Richmond SoMa Mission District Silver Terrace Excelsior Bayview Lakeshore Oceanview Visitacion Valley 1 mi 1 km Oakland Pacific Ocean Chinatown Alameda Tenderloin Western Addition Outer Richmond SoMa Mission District San Francisco Bay Silver Terrace Excelsior Bayview Lakeshore Oceanview Visitacion Valley 1 mi 1 km Oakland Pacific Ocean Chinatown Financial District Alameda Tenderloin Western Addition SoMa Outer Richmond Mission District San Francisco Bay Silver Terrace Bayview Lakeshore Excelsior Oceanview Visitacion Valley 1 mi 1 km North Beach Pacific Ocean Marina Pacific Heights Outer Richmond Potrero Hill Haight- Ashbury Outer Sunset Diamond Heights Parkside Sunnyside Ingleside 1 mi 1 km Pacific Ocean North Beach Marina Pacific Heights Outer Richmond Inner Richmond Haight- Ashbury Potrero Hill Eureka Valley Outer Sunset Inner Sunset Diamond Heights Parkside Sunnyside Ingleside 1 mi 1 km Oakland Pacific Ocean North Beach Marina Pacific Heights Alameda Outer Richmond Inner Richmond Haight- Ashbury Potrero Hill Eureka Valley Outer Sunset Inner Sunset San Francisco Bay Diamond Heights Parkside Sunnyside Ingleside 1 mi 1 km Oakland Pacific Ocean North Beach Marina Pacific Heights Alameda Outer Richmond Inner Richmond Haight-Ashbury Potrero Hill Eureka Valley Outer Sunset Inner Sunset San Francisco Bay Diamond Heights Parkside Sunnyside Ingleside 1 mi 1 km Pier 41 Ferry Building Pacific Ocean Cable car lines BART Muni Metro N Line Caltrain Muni Metro T Line Muni Metro L Line 1 mi BART Caltrain 1 km Pier 41 Ferry Building BART Pacific Ocean Cable car lines Caltrain Muni Metro N Line BART Muni Metro J Line Muni Metro T Line Muni Metro L Line Muni Metro K Line Muni Metro M Line 1 mi BART Caltrain 1 km Pier 41 Oakland BART Ferry Building Pacific Ocean Cable car lines Alameda Caltrain Muni Metro N Line BART San Francisco Bay Muni Metro J Line Muni Metro T Line Muni Metro L Line Muni Metro K Line Muni Metro M Line 1 mi 1 km BART Caltrain Pier 41 Oakland Muni Metro F Line BART Pacific Ocean Ferry Building Cable car lines Alameda Caltrain Muni Metro N Line BART San Francisco Bay Muni Metro J Line Muni Metro T Line Muni Metro L Line Muni Metro K Line Muni Metro M Line 1 mi 1 km BART Caltrain Pacific Ocean Amazon Facebook Google Yelp Apple Twitter Uber Square Airbnb SAN FRANCISCO county 1 mi SAN MATEO county 1 km Yerba Buena Island Pacific Ocean Presidio of San Francisco Amazon Google Salesforce Facebook Yelp Apple Twitter Airbnb Uber Square Golden Gate Park Twin Peaks SAN FRANCISCO county Lake Merced Park John McLaren Park 1 mi SAN MATEO county 1 km Oakland Yerba Buena Island Pacific Ocean Alameda county Presidio of San Francisco Amazon Google Salesforce Facebook Alameda Yelp Apple Twitter Airbnb Uber Square Golden Gate Park Twin Peaks SAN FRANCISCO county San Francisco Bay Lake Merced Park John McLaren Park 1 mi 1 km SAN MATEO county Oakland Yerba Buena Island Pacific Ocean Presidio of San Francisco Alameda county Amazon Google Salesforce Facebook Alameda Yelp Apple Twitter Uber Square Airbnb Golden Gate Park San Francisco Bay Twin Peaks SAN FRANCISCO county Lake Merced Park John McLaren Park 1 mi SAN MATEO county 1 km Source: UrbanFootprint California State Senate Bill 50 (SB 50) would set a state-wide standard for density in many places. Here’s how UrbanFootprint says it would impact ◼residential areas in San Francisco... Any number of homes have to be allowed within a ◼quarter-mile of a major bus stop1, within height and yard limits. The same goes for places a ◼half-mile from rail or ferry stop, but buildings must be allowed to be at least 45-feet-tall. A ◼quarter-mile from that same transit, the height rises to 55 feet.2 SB 50 calls for designating ◼Jobs-rich areas to ensure that areas with good public schools and easy access to employment have plenty of housing—even if they aren’t close to transit. Cities would have to allow for the same density in these communities as they do for areas a quarter-mile from a major bus stop. Because the bill doesn't specifically define what makes a jobs-rich area, UrbanFootprint approximated where these might be drawing on previous work mapping high-opportunity areas in California. The bill delays changes for ◼sensitive communities at risk of gentrification. These areas would undergo a five-year community process to plan for zoning shifts.

In Silicon Valley, suburban communities that are home to fast-growing tech giants have been resistant to new building. They could add density under the proposed bill.

Silicon Valley ◼ Within ¼ mile of a major bus stop ◼ Within ½ or ◼ ¼ mile of rail or ferry ◼ “Jobs-rich” areas ◼ “Sensitive” communities San Mateo Fremont ALAMEDA Facebook Palo Alto Milpitas Google Tesla SAN MATEO Sunnyvale Apple San Jose Cupertino 5 mi SANTA CLARA Netflix 5 km Within ◼ ¼ mile of a major bus stop Within ◼ ½ or ◼ ¼ mile of rail or ferry ◼ “Jobs-rich” areas ◼ “Sensitive” communities San Francisco Bay Fremont San Mateo ALAMEDA Facebook Redwood City Palo Alto Milpitas Google SAN MATEO Tesla Mountain View Sunnyvale Santa Clara Apple Adobe SANTA CLARA San Jose Cupertino Campbell 5 mi Netflix 5 km Within ◼ ½ or ◼ ¼ mile of rail or ferry Within ◼ ¼ mile of a major bus stop ◼ “Jobs-rich” areas ◼ “Sensitive” communities San Francisco Bay Fremont San Mateo ALAMEDA Facebook Redwood City Palo Alto Milpitas Google Google SAN MATEO Tesla Mountain View Sunnyvale Santa Clara Apple Adobe SANTA CLARA San Jose Cupertino Campbell Netflix 5 mi 5 km Within ◼ ½ or ◼ ¼ mile of rail or ferry Within ◼ ¼ mile of a major bus stop ◼ “Jobs-rich” areas ◼ “Sensitive” communities San Francisco Bay Fremont San Mateo ALAMEDA Facebook Redwood City Palo Alto Milpitas Google Google SAN MATEO Tesla Mountain View Sunnyvale Santa Clara Apple Adobe San Jose Cupertino SANTA CLARA Campbell Netflix 5 mi 5 km Source: UrbanFootprint

Los Angeles neighborhoods that have seen prices soar because of an influx of tech-heavy jobs would potentially accommodate more growth.

Los Angeles ◼ Within ¼ mile of a major bus stop ◼ Within ½ or ◼ ¼ mile of rail or ferry ◼ “Jobs-rich” areas ◼ “Sensitive” communities Glendale Netflix Beverly Hills Los Angeles Santa Monica Snap Huntington Park Twitter Facebook Google Inglewood 5 mi Compton 5 km Manhattan Beach Within ◼ ½ or ◼ ¼ mile of rail or ferry Within ◼ ¼ mile of a major bus stop ◼ “Jobs-rich” areas ◼ “Sensitive” communities Pasadena Glendale Netflix West Hollywood Beverly Hills Los Angeles Google (opening 2022) Santa Monica Snap Culver City Twitter Huntington Park Google Facebook YouTube Inglewood Pacific Ocean Compton 5 mi 5 km Manhattan Beach Within ◼ ½ or ◼ ¼ mile of rail or ferry Within ◼ ¼ mile of a major bus stop ◼ “Jobs-rich” areas ◼ “Sensitive” communities Pasadena Glendale West Hollywood Netflix Beverly Hills Los Angeles Google (opening 2022) Snap Culver City Santa Monica Twitter Google Huntington Park Facebook YouTube Inglewood Pacific Ocean Compton 5 mi Manhattan Beach 5 km Within ◼ ½ or ◼ ¼ mile of rail or ferry Within ◼ ¼ mile of a major bus stop ◼ “Jobs-rich” areas ◼ “Sensitive” communities Pasadena Glendale Netflix West Hollywood Beverly Hills Los Angeles Google (opening 2022) Culver City Snap Santa Monica Twitter Google Huntington Park Facebook YouTube Inglewood Pacific Ocean Compton Manhattan Beach 5 mi 5 km Source: UrbanFootprint

The stakes couldn’t be higher. California can keep attracting all the “highly talented individuals that make the knowledge economy work,” said Herbert of Harvard’s Joint Center. But, at some point, he added, “the state’s economy will be strangled by the inability to have a broad workforce.”

In other words, a place known for diversity, innovation and quality of life may be left for no one but the rich and lucky, who got there before it was too late.